查尔斯亨格瑞-财务会计-课后练习答案01

CHAPTER1COVERAGEOFLEARNINGLO1:ExplainhowinformationinmakingLO2:Describe

1,2,3,4,5,236,7,22

26

balancesheet.LO3:Analyzebusinessandrelatethemtobalancesheet.LO4:balancesheettransactions

8,9

32,33,34,35,38,39,40,

LO5:ofsoleproprietorships,LO6:howthe

owners’equitysectioninabalancediffersfromthatasoleoraLO7:ExplaintheofincludingdifferencesbetweenU.S.GAAPLO8:Describeauditingitvalueinformation.LO9:roleethicsintheaccounting

20

Chapter1Accounting:TheLanguageofBusiness

1

CHAPTER1aprocessofidentifying,recording,informationtodecisionNo.isrealinformationrealcompanies.Inlearningithelpfultoreportsfromvariousputtechniquesaccountinganunderstandableprovidesfamiliaritywiththediversityofofdecisionsthatlikelybeinfluencedbyfinancialincludewhereexpandorreduceoperations,lendingmoney,investingcapital,rewardingmangers.offinancialincludesuppliers,owners,taxauthorities,andgovernmentregulators.Thebetweenaccountingistheiruseofdecisionmakers.ManagementconcernedmainlywithhowcanserveinternalmakerssuchthechiefaccountingisconcernedwithinformationThebalancesheetequationisAssets=LiabilitiesOwners’equity.Itisthefundamentalframeworkofleftsideliststheresourcesoftheorganization,andtherightsideliststheagainstthoseresources.No.EverytransactionshouldinAccountingisoftencalled-entry‖becauseaccountantsmustenterattwonumbersforeachtransactionkeeptheintrue.WhenainventoryforassetisforneithertotalliabilitiesThus,balancesheetequationinacompanybuysoncredit,bothinventoryincrease.Thus,totalassetsandliabilitiesincreasebyagainthebalanceinTheforpayableincludesaevidencefordoesnot.Anotegenerallyalenderanaccountisgenerallyaincorporationseasilytradedinmarkets,ownershavelimitedliability,ownersofproprietorshipsorpartnershipsareusuallyalsoinwhilemostcorporationshiremanagers.2Limitedliabilitymeansthatcorporateownersarenotpersonallyliablethedebtsofcorporation.’claimscanbesatisfiedonlybytheassetsofcorporation.Thecorporationprominentofentitydobyfarvolumeofbusiness.InUnitedKingdomuselimited(Ltd.)inname.InmanywhoselawsbacktoSpain,theinitialsreferto,‖meaningthatmultipleunidentifiedownersstandbehindthesameaallissuanceofbelowparatlowandnoimportanceinaffectingoftheissuingentity.TheboardofisthelinkbetweenItistheboard’sdutytoensurethatmanagersactinthebestofshareholders.InGAAPissetbytheFinancialStandardsBoard.ThehasforspecifyingaccountingforwithpubliclyheldasdelegatedbyitusuallyacceptspromulgatedtheFASB.Internationally,ofcountriesacceptIFRSasbytheInternationalBoardtheirGAAP.UntilHowever,nowtheheadquarteredoutsidetheU.toIFRS.Auditshavevaluebecausetheyytoacompany’sfinancialstatements.Providedthatauditorshaveexpertisetoassessoffinancialtheintegrityanycanputmorefaithinthatareaudited.ACPAcertifiedpublicbyaofeducation,qualifyingexperience,andpassingofexamination.ACA(charteredaccountant)istheequivalentofainmanypartsofworld,formerBritishaccountantsmuststandardsofindependenceandintegrity.Inaddition,arestandardsthatpertaintoSomecallaccountingthemoralguardianofcompanies.beenrecentlybythat(or,least,bybutaccountantsareworkingtoregainthehighethicaltheymaintained.Chapter1Accounting:TheLanguageofBusiness

3fundamentalaccountingapplyequallytononprofitnot-for-profit)organizations.accountantsinuniversities,andnonprofitorganizationsusefinancialstatements.Theytoraiseandmoney,preparefinancialperformance.Nonprofitorganizationsneedtheirlimitedfinancialessentialforjudgingtheirofresources.Double-entryreferstothattransactiontwowitheffecttotheinthebalanceThedouble-entryisitemphasizesassetsandonassets.Inthebalanceforanasset,cash,aliability.Inconceptualthereisaclericalbenefit.abalancedrelationshipprovidesanindicatoroferrors.IfbalancesheetequationdoesnotanbeenHistoriansprimarilyconcernedwitheventsthatalreadyInthatacompany’sfinancialstatementsdoreportonhistory—thatcomplete.Thenegativeofisthatmanythataffecttheoffirmbasedwillthefuture.Thus,oftenpredictions.Ofcourse,therenowaytoonofpredictions.offinancialthattheypresentahappened,atinwhatitperiodofItiseasiertoyouknowyouarethere.Youtheimportanceofhistoricalfinancialtheimportanceofnavigationinstruments.Ifyoudowhereyouheaded,itveryhardgettowanttopeoplewhoaccountantshistoriansitasacriticism,although,asindicatedensuresaremeasurableSuchargumentsarebutcanbetrulyThenotionofthatanygrowthtooccurtheremustsystemforresourcesthemperiodsoftime.formissuancewellborrowing.ItallowsustofromItofshareholders,andlossesbelimited,undertakingscanbefinanced.Finally,ithaslifeitsactivityisbythedeathanyshareholder.underasetofestablishedofforintothatpartiesbeupontheirsideofanagreement.corporationsemergeasthedominanteconomicinworld.accountingitwouldbedifficulttooflargecorporations.Itwouldbeespeciallydifficulttofromifaccountingnotprovideinformationaboutof4Theauditorincreasesthevalueoffinancialbytheofthestatementsthatananda‖thirdpartyhasreviewedmanagementdisclosuresandbelievestheyfairlypresentthecompany’sperformance.Thefactthatpersonallynotthenameoffirmshouldnotproblem,becauseonlycanpublicauditssignopinions.statestrictprocedureslicensingsosuchqualified.Nevertheless,firmsdevelopreputations,oneswithpublicmaygivesomefinancialstatementconfidenceinfinancialaudit.min.)Amountsareinmillions.

Assets=LiabilitiesOwners’Equity$7=$3+$4Assetsandliabilitieswouldincrease$1million.Owners’equitywouldbeunaffected.min.)June2

Ownersadditionalinol’sCompany.Ownersinvestedan$4,000intocompanybycontributingstorefixturesvaluedat$4,000.Sok’sCompanypurchasedfurnitureforSok’sCompanyfurnitureinventoryaccountforSok’sFurniturefixturesforcash.Sok’sFurniturepurchased$6,000ofstorefixtures,payingcashagreeingtolater.Sok’sFurnitureonaccountsSok’s$400ofmerchandise(furnitureinventory)creditaccountspayable.Ownersfrom’sCompany.Chapter1Accounting:TheLanguageofBusiness

5min.)

Brisbaneoffixturesonownerswithdrewofitsinventoryoffor$5,000againstitsaccountspayable.(inventory)valuedat$7,000wereinthecompanybyowners.Brisbane$500onBrisbanepurchasedofstorefixtures,$1,000nowto$2,50010Brisbanereturned$300offixturescreditaccountspayable.min.)ATLANTABalanceSheetMarchLiabilitiesand

Stockholders’fixturesLandTotal

$(b)(d)$141,000

Liabilities:NotesLong-termdebtTotalliabilitiesStockholdersequity:Paid-incapitalTotal

$(f)(g)(h)$141,000

–10,000=+=fixtures:3,000=equipment:+=8,000+=Long-termdebt:12,000+Paid-in=Note:Event5requiresnochangeinthebalancesheet.6min.)LIVERPOOLBalanceSheet30,

LiabilitiesandStockholders’Equity

£

(a)

Liabilities:

£

(d)fixturesLandTotal

£

Notes31,000Long-termdebtTotalliabilities141,000Stockholders’equity:Paid-inCapital

Total

£

–7,000+=equipment:+=–6,000=–Notespayable:21,000+(13,000–3,000)Long-termdebtpayable:124,000–=101,000Paid-in+=223,000Note:Event4requiresnochangeinthebalancesheet.min.)

Totalliabilities=Totalassetsstockholdersequitystock,=×10,536,897,000=LikeotheritemsonGeneralElectric’sbalancesheet,theamountwouldberoundedofftomillions:stock,$738Chapter1Accounting:TheLanguageofBusiness

7min.)SeeEquipmentandcouldbeintwoseparateaccountsrathermin.)1.

See2.

LMNCORPORATIONBalanceSheet20X1(InThousandsofDollars)

LiabilitiesandStockholders’Liabilities:Total

$13126936$436

NotepayableTotalliabilitiesStockholdersequity:Capital$1outstandingAdditionalpaid-incapitalinofvalueTotal

$30106$136$30270300$436min.)1.

See2.

AUTOPARTESMADRIDBalanceSheetMarch

Liabilitiesand’EquityTotal

€€

Liabilities:NotepayableTotalliabilitiesYou,capitalTotal

€€8EXHIBIT–MCLEANSERVICES,ofApril(InThousandsofDollars)

LiabilitiesandStockh

NoteAccountsof

Furniture

++ofofAcquisitionforcash

–33

5.Acquisitionaccount

6.Paymentsto

–4

–4SaleNoentry

8

–8

111

6111

MCLEANSERVICES,BalanceSheetApril30,20X1LiabilitiesandStockholdersNotepayable35,000furnitureTotal

$$111,000

6,000Paid-inCapital70,000TotalChapter1Accounting:TheLanguageofBusiness

9EXHIBIT–LMNCORPORATION20X1ofTransactions(InThousandsofDollars)Liabilities+Merch-

Equip-

Notesof

Inventoryment++

(1.incorporation

+purchasedpurchased4.Returnofinventory

–95==+85

–11

–11ofSale

–104

=–4=

creditorpurchased

–18–50

–18509.Noon

January31,

=

436

43610EXHIBIT–AUTOPARTESMADRIDofTransactionsFortheMonthMarch31,20X1

LiabilitieEquip-

of

ment

+forcash3.Inventoryon

Noentry

–

6.Tiresforfamily

–

600

7.toforcash

300

–

300

8.Noeffectontotalinventory9.to

forcredit

–

500

–50010.onnote

–

11.Equipment

12.to

–

–NoentryNoentry15.of

–

+17,500+4,500Chapter1Accounting:TheLanguageofBusiness

11min.)Notethat9isnotcovereddirectlytheitshouldbepossibletofigureoutaccountingforitfromsimilarthatarecovered.someinstructorswanttoomit9.1.

See2.

FREIDACRUZ,BalanceSheet31,20X0Liabilitiesand

Owner’sEquityLiabilities:inbankNotereceivableRentaldamageLegalonComputerOfficefurnitureTotalassets

NotepayableTotalliabilitiesOwnerequity:FreidaCruz,capitalTotalliabilitiesownersequity

$$min.)Exhibit1-36.min.)1.See2.InventoriesassetsTotal

$

NIKE,INC.BalanceSheetJune3,(InLiabilitiesand’TotalliabilitiesOwnersequityTotal

$12EXHIBIT–FREIDAATTORNEYof(InThousandsofDollars)=Liabilitiesa

Note

RentalLegalOffice

in

Receiv-

DamageSupplies

Furni-Noteof2.Openinginvestment

DepositonHandComputerturePayable4.–1

+1

5.Purchased–2

+5

+3PurchasedPurchased

+1

furniture

–4

+4

9.NotereceivablefromG.See

–2

+2

31,

+2

+1

+1

+5

+4

+359•3business•In(liability)upthebecauseitisnotuntil2androccuruntil•Transaction8nonohaveduringDecember.Chapter1Accounting:TheLanguageofBusiness

13EXHIBIT–WALGREENCOMPANYofTransactions(InMillionsofDollars)

LiabilitiesandStoInven-Other

Notesof

+Assets+BalanceMayofforofforequipmentAcquisitionofforcash5.Acquisitionofon

–18

15,952=4,599===6.Paymentsto

–35

–357.SaleofBalanceJune2

+2

-216,010=132WALGREENCOMPANYBalanceSheetJune2,(InMillionsofDollars)LiabilitiesandStockholders’Inventoriesother

$

Notes$liabilities14

Total

tockholdersotal$2EXHIBIT–ofBalanceMay

NIKE,INC.ofTransactions(InMillionsofDollars)Inven-Plant,and+Equip.1,958

purchasedpurchasedofinventory

==to

4.of

=SaleNoentrycreditorfrombank

10.entryexceptonJune3

1,932=Chapter1Accounting:TheLanguageofBusiness

15min.)

REBECCAGURLEY,REALTORBalanceSheet30,Liabilitiesand’EquityOfficefurnitureFranchiseTotalassets

$(b)$220,000

Liabilities:MortgagepayableTotalliabilitiesOwnerequity:RebeccaTotalliabilitiesers

$(c)$220,000–Afranchiseisanbeentobenefitfuture$220,000–$101,000=$119,000NotethatGoldsteinshavenegativeinfluenceonbutaccountingdoesnotmonetaryMoreover,transactions34arebusinesstransactions.min.)

wouldrisebytheliability,Deposits,bysameDepositsareliabilitiesbecauseFargothesetoTheyaredepositorsonassetsthebank.LoansReceivablewouldCashwoulddecreaseDepositswouldCashby$4,000.min.)

Amountsareinmillions.1.

assets€28,598€4,106Stockholders’equity=Totalassetsliabilities€€2.16

Totalliabilitiesandstockholders’equity=totalassets=€28,598.min.)Inventoriesassetsassets

UNITEDBalanceSheetJune30,(InMillionsofDollars)LiabilitiesandStockholders$(1)liabilitiesLongdebtTotalliabilitiesOtherstockholdersequity(3)Totalstockholders’

$Totalassets

equityTotalliabilitiesstockholders

(2)(1),(2),(3)designateanswerstorequirements.(1)Thecashwasbyassetsallcash.calculate(2)(3),thattotalassetsmustequallliabilitiesplusstockholders$56,545.liabilitiesis++$8,721=Therefore,totalstockholders–=denotedby(2)above.Otherstockholdersequityis$18,406–=denotedby(3)Chapter1Accounting:TheLanguageofBusiness

17min.)

MACY’S,INC.BalanceSheetAugust1,2009(InMillionsofDollars)LiabilitiesandShareholders’Equity

$515

(a)

Inventoriesassets

Long-termdebtliabilitiesTotalliabilitiesShareholdersequity

$(b)TotalliabilitiesTotalassets

shareholdersequity

(a),(b),theanswerstotheCashiscalculatedbysubtractinggivenforotherfromassets:$20,784$4,634smallestCompaniestrytokeepcashsmallearnoncashaccounts.simplyaddcomponents+Forthattotalliabilitiesandrs’equityassets,$20,784,’equitylesstotalliabilitiesof$16,235,whichequals18(10min.)1.Rentalhouse

ABBOUDPARTNERSBalanceSheetJune15,20X0LiabilitiesandOwners’Equity$300,000MortgageOwners’equityAdnanCapital

$240,000Totalassets

$300,000

Totalliabilitiesow’equity

$300,0002.Rentalhouse

ABBOUDBalanceSheetJune15,20X0Liabilities&Stockholders’Equity$300,000MortgageStockholders’equitystock,Additionalpaid-incapital

$240,000Totalassets

$300,000

Totalliabilities’

$300,000min.)1.linewouldincreaseby500,000,000×$.01outstandingwould500million.Additionalwouldby×–=$2,995,000,000.2.

IBMshowsallofaTherefore,itswouldbyofissuedandwouldincreaseby1million.Chapter1Accounting:TheLanguageofBusiness

19Theshould$.75=million.TheaveragebytheoriginalinvestorsChevroncommonwas$14,359millionmillionmillion=$6.63.Notethatisto$6.63.Therelativelybetweentheoriginalpricecurrentmarketon30,istypicalmanyThisisusuallycausedbyincreasedbasedonofprofitableoperationsovermanyyears.min.)

TheparvalueofHonda’sshares¥86,067,000,000÷1,834,828,430Theaveragepriceperbytheoriginalinvestorswas¥140.9:¥86,067+¥172,529=¥258,596million;¥258,596million÷¥Notethat¥140.9theparvalueof¥46.9.Thebetweentheoriginalpriceofthepriceofoffiscal2009istypicalforcompanies.usuallybybasedonofprofitableoperationsyears.(10min.)aretwoofaccepted(GAAP)inworld—bytheGAAPbyStandardsIn2005UnionadoptedIFRStousedbyallinitsmembernations.Carrefour,amustissuefinancialthatcomplywithItsauditorswillexamineitsfinancialwithconfirmthisinauditopinion.Althoughnotmentionedinthechapter,thephraseadoptedbytheEuropeanUnion‖isalsosignificant.Asinmanycases,thatIFRSmaynotacceptofitstheEuropeanUnionmakesafewadjustmentstoInbasedinUnitedasSafeway,useU.S.notIFRS.Thus,Safeway’sauditopinionclearlystatesthatstatementscomplywithS.Bothcompanies&ToucheLLPasanauditor,theapplydifferentwhenauditingwhenauditingSafeway.20min.)NOTEwanttoarecentannualtheontheboardmaythegeneralmixofbackgroundsofboardistoTheofdirectorsofMillshasofisaGeneralMills—J.CEOchairmanofOf139arecurrentretiredexecutivesofcompanies,oneisanattorney,isaventureisaanacademic(deanDartmouth’sTuckSchool).thearecurrentlyacademics,also.ThehavesufficientdirectorstoavoidtoomuchmanagementshouldexperiencestotoboardaremembersoftheareMillstheyareThethecommitteewasgivenextensivepowerbytheAct.Itchargedwithforthefinancialreportingthetaskthatisimportantshareholders,whorelyfinancialreportsforChapter1Accounting:TheLanguageofBusiness

21min)Credibilityofaccountingisessential.Decisionwithinoutsideofanrelyaccountingreportsfordecisions.Foraccountingreportshavecredibility,haveintheauditorsofreports.Internalaccountantshavetotheyhavetoanentireorganization.Theybetrustedkeepcertainofinformationwellastofullyaccuratelytoneedinformationfordecisions.oftheiraccesstosomuchinformation,accountantsalsoasofanorganization,identifyingwheremayintentionallybeThisisaresponsibility,itthetrustoftheorganization.havevaluecredibilitytofinancialstatements.Managementfinancialbepronetooperatingresultsofnaturaloptimismorbecausetheirorlinkedtooperatingperformance.Ifinvestorsoffinancialdohavefaithinfairness,objectivityofauditors,auditswillhavedevelopingmaintaininghighethicalstandardsisaofauditingindividualaccountantscognizantoftheneeddevelopmaintainaforbehavior,buttheneedtobecollectivelyhighlyethical.AnybreachofconductbyaccountanthasspillovereffectsItisimportanttoallaccountantsthatofaccountingberegardedhighlyTherefore,professionalaccountingorganizationshavedevelopedstandardsofCertificationCertifiedCertifiedManagementAccountant(CMA)exams,testapplicantsknowledgeofethicalstandards,theassociationscompliancetobypenalizingtheInthiswaypublicbethattheywithaaccountantheorshewillbefamiliarwithstandards