Financial Accounting: Tools for Business Decision Making, 7th Edition

Financial Accounting: Tools for Business Decision Making, 7th Edition

Released October 2012
Publisher(s): Wiley
ISBN: 9781118162286

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Book description

Students get accounting when using Kimmel Financial Accounting with WileyPLUS because we make learning accounting easy and accessible for today's different types of learners. Written in a concise, clear, and conversation way, Kimmel Financial Accounting provides just the right amount of information students need to come to class prepared, while powerful visuals and Interactive Tutorials make complex accounting concepts possible to absorb quickly.

Starting with the big picture of financial statements first, Paul Kimmel shows students why financial accounting is important to their everyday lives, business majors, and future careers. This best-selling financial accounting text is known for the most relevant and easy to understand examples, while teaching students the accounting cycle through the lens of one consistent story of Sierra Corp, an outdoor adventure company.

The automatically graded WileyPLUS problem-solving experience imitates a blank sheet of paper with type-ahead for entering account titles, so that students use recall memory when they practice or do homework online. More students get accounting when using Kimmel Financial Accounting with WileyPLUS, because they can Read It, See It, Do It - Get It.

WileyPLUS sold separately from text.

Table of contents

  1. Cover Page
  2. Title Page
  3. Copyright
  4. Brief Contents
  5. From the Authors
  6. Your Team for Success in Accounting
  7. Author Commitment
  8. The Wiley Faculty Network
  9. WileyPLUS
  10. What's New?
  11. Content Changes by Chapter
  12. Active Teaching and Learning Supplementary Material
  13. Acknowledgments
  14. Contents
  15. Student success is a team effort.
  16. Chapter 1: Introduction to Financial Statements
    1. Knowing the Numbers
    2. Forms of Business Organization
    3. Users and Uses of Financial Information
      1. Internal Users
      2. External Users
      3. Ethics in Financial Reporting
    4. Business Activities
      1. Financing Activities
      2. Investing Activities
      3. Operating Activities
    5. Communicating with Users
      1. Income Statement
      2. Retained Earnings Statement
      3. Balance Sheet
      4. Statement of Cash Flows
      5. Interrelationships of Statements
      6. Other Elements of an Annual Report
    6. A Look at IFRS
  17. Chapter 2: A Further Look at Financial Statements
    1. Just Fooling Around?
    2. The Classified Balance Sheet
      1. Current Assets
      2. Long-Term Investments
      3. Property, Plant, and Equipment
      4. Intangible Assets
      5. Current Liabilities
      6. Long-Term Liabilities
      7. Stockholders’ Equity
    3. Using the Financial Statements
      1. Ratio Analysis
      2. Using the Income Statement
      3. Using the Statement of Stockholders’ Equity
      4. Using a Classified Balance Sheet
    4. Keeping an Eye on Cash
    5. Financial Reporting Concepts
      1. The Standard-Setting Environment
      2. Qualities of Useful Information
      3. Assumptions in Financial Reporting
      4. Principles in Financial Reporting
      5. Cost Constraint
    6. A Look at IFRS
  18. Chapter 3: The Accounting Information System
    1. Accidents Happen
    2. The Accounting Information System
      1. Accounting Transactions
      2. Analyzing Transactions
      3. Summary of Transactions
    3. The Account
      1. Debits and Credits
      2. Debit and Credit Procedures
      3. Stockholders’ Equity Relationships
      4. Summary of Debit/Credit Rules
    4. Steps in the Recording Process
      1. The Journal
      2. The Ledger
      3. Chart of Accounts
      4. Posting
      5. The Recording Process Illustrated
      6. Summary Illustration of Journalizing and Posting
    5. The Trial Balance
      1. Limitations of a Trial Balance
    6. Keeping an Eye on Cash
    7. A Look at IFRS
  19. Chapter 4: Accrual Accounting Concepts
    1. Keeping Track of Groupons
    2. Timing Issues
      1. The Revenue Recognition Principle
      2. The Expense Recognition Principle
      3. Accrual versus Cash Basis of Accounting
    3. The Basics of Adjusting Entries
      1. Types of Adjusting Entries
      2. Adjusting Entries for Deferrals
      3. Adjusting Entries for Accruals
      4. Summary of Basic Relationships
    4. The Adjusted Trial Balance and Financial Statements
      1. Preparing the Adjusted Trial Balance
      2. Preparing Financial Statements
      3. Quality of Earnings
    5. Closing the Books
      1. Preparing Closing Entries
      2. Preparing a Post-Closing Trial Balance
      3. Summary of the Accounting Cycle
    6. Keeping an Eye on Cash
    7. APPENDIX 4A: Adjusting Entries in an Automated World—Using a Worksheet
    8. A Look at IFRS
  20. Chapter 5: Merchandising Operations and the Multiple-Step Income Statement
    1. Buy Now, Vote Later
    2. Merchandising Operations
      1. Operating Cycles
      2. Flow of Costs
    3. Recording Purchases of Merchandise
      1. Freight Costs
      2. Purchase Returns and Allowances
      3. Purchase Discounts
      4. Summary of Purchasing Transactions
    4. Recording Sales of Merchandise
      1. Sales Returns and Allowances
      2. Sales Discounts
    5. Income Statement Presentation
      1. Sales Revenues
      2. Gross Profit
      3. Operating Expenses
      4. Nonoperating Activities
      5. Determining Cost of Goods Sold Under a Periodic System
    6. Evaluating Profitability
      1. Gross Profit Rate
      2. Profit Margin
    7. Keeping an Eye on Cash
    8. APPENDIX 5A: Periodic Inventory System
      1. Recording Merchandise Transactions
      2. Recording Purchases of Merchandise
      3. Freight Costs
      4. Recording Sales of Merchandise
      5. Comparison of Entries—Perpetual vs. Periodic
    9. A Look at IFRS
  21. Chapter 6: Reporting and Analyzing Inventory
    1. “Where Is That Spare Bulldozer Blade?”
    2. Classifying and Determining Inventory
      1. Classifying Inventory
      2. Determining Inventory Quantities
    3. Inventory Costing
      1. Specific Identification
      2. Cost Flow Assumptions
      3. Financial Statement and Tax Effects of Cost Flow Methods
    4. Keeping an Eye on Cash
      1. Using Inventory Cost Flow Methods Consistently
      2. Lower-of-Cost-or-Market
    5. Analysis of Inventory
      1. Inventory Turnover
      2. Analysts' Adjustments for LIFO Reserve
    6. APPENDIX 6A: Inventory Cost Flow Methods in Perpetual Inventory Systems
      1. First-In, First-Out (FIFO)
      2. Last-In, First-Out (LIFO)
      3. Average-Cost
    7. APPENDIX 6B: Inventory Errors
      1. Income Statement Effects
      2. Balance Sheet Effects
    8. A Look at IFRS
  22. Chapter 7: Fraud, Internal Control, and Cash
    1. Minding the Money in Moose Jaw
    2. Fraud and Internal Control
      1. Fraud
      2. The Sarbanes-Oxley Act
      3. Internal Control
      4. Principles of Internal Control Activities
      5. Limitations of Internal Control
    3. Cash Controls
      1. Cash Receipts Controls
      2. Cash Disbursements Controls
    4. Control Features: Use of a Bank
      1. Bank Statements
      2. Reconciling the Bank Account
    5. Reporting Cash
      1. Cash Equivalents
      2. Restricted Cash
    6. Managing and Monitoring Cash
      1. Basic Principles of Cash Management
    7. Keeping an Eye on Cash
    8. APPENDIX 7A: Operation of the Petty Cash Fund
      1. Establishing the Petty Cash Fund
      2. Making Payments from Petty Cash
      3. Replenishing the Petty Cash Fund
    9. A Look at IFRS
  23. Chapter 8: Reporting and Analyzing Receivables
    1. What's Cooking?
    2. Types of Receivables
    3. Accounts Receivable
      1. Recognizing Accounts Receivable
      2. Valuing Accounts Receivable
    4. Notes Receivable
      1. Determining the Maturity Date
      2. Computing Interest
      3. Recognizing Notes Receivable
      4. Valuing Notes Receivable
      5. Disposing of Notes Receivable
    5. Financial Statement Presentation of Receivables
    6. Managing Receivables
      1. Extending Credit
      2. Establishing a Payment Period
      3. Monitoring Collections
      4. Evaluating Liquidity of Receivables
      5. Accelerating Cash Receipts
    7. Keeping an Eye on Cash
    8. A Look at IFRS
  24. Chapter 9: Reporting and Analyzing Long-Lived Assets
    1. A Tale of Two Airlines
    2. Plant Assets
      1. Determining the Cost of Plant Assets
      2. To Buy or Lease?
    3. Accounting for Plant Assets
      1. Depreciation
      2. Factors in Computing Depreciation
      3. Depreciation Methods
      4. Revising Periodic Depreciation
      5. Expenditures During Useful Life
      6. Impairments
      7. Plant Asset Disposals
    4. Analyzing Plant Assets
      1. Return on Assets
      2. Asset Turnover
      3. Profit Margin Revisited
    5. Intangible Assets
      1. Accounting for Intangible Assets
      2. Types of Intangible Assets
    6. Financial Statement Presentation of Long-Lived Assets
    7. Keeping an Eye on Cash
    8. APPENDIX 9A: Calculation of Depreciation Using Other Methods
      1. Declining-Balance
      2. Units-of-Activity
    9. A Look at IFRS
  25. Chapter 10: Reporting and Analyzing Liabilities
    1. And Then There Were Two
    2. Current Liabilities
      1. What Is a Current Liability?
      2. Notes Payable
      3. Sales Taxes Payable
      4. Unearned Revenues
      5. Current Maturities of Long-Term Debt
      6. Payroll and Payroll Taxes Payable
    3. Bonds: Long-Term Liabilities
      1. Types of Bonds
      2. Issuing Procedures
      3. Determining the Market Price of Bonds
    4. Accounting for Bond Issues
      1. Issuing Bonds at Face Value
      2. Discount or Premium on Bonds
      3. Issuing Bonds at a Discount
      4. Issuing Bonds at a Premium
    5. Accounting for Bond Redemptions
      1. Redeeming Bonds at Maturity
      2. Redeeming Bonds before Maturity
    6. Financial Statement Presentation and Analysis
      1. Balance Sheet Presentation
    7. Keeping an Eye on Cash
      1. Analysis
      2. Off-Balance-Sheet Financing
    8. APPENDIX 10A: Straight-Line Amortization
      1. Amortizing Bond Discount
      2. Amortizing Bond Premium
    9. APPENDIX 10B: Effective-Interest Amortization
      1. Amortizing Bond Discount
      2. Amortizing Bond Premium
    10. APPENDIX 10C: Accounting for Long-Term Notes Payable
    11. A Look at IFRS
  26. Chapter 11: Reporting and Analyzing Stockholders' Equity
    1. Oh Well, I Guess I'll Get Rich
    2. The Corporate Form of Organization
      1. Characteristics of a Corporation
      2. Forming a Corporation
      3. Stockholder Rights
    3. Stock Issue Considerations
      1. Authorized Stock
      2. Issuance of Stock
      3. Par and No-Par Value Stocks
      4. Accounting for Issues of Common Stock
    4. Accounting for Treasury Stock
      1. Purchase of Treasury Stock
    5. Preferred Stock
      1. Dividend Preferences
      2. Liquidation Preference
    6. Dividends
      1. Cash Dividends
      2. Stock Dividends
      3. Stock Splits
    7. Retained Earnings
      1. Retained Earnings Restrictions
    8. Financial Statement Presentation of Stockholders' Equity
      1. Balance Sheet Presentation
    9. Keeping an Eye on Cash
    10. Measuring Corporate Performance
      1. Dividend Record
      2. Earnings Performance
      3. Debt versus Equity Decision
    11. APPENDIX 11A: Entries for Stock Dividends
    12. A Look at IFRS
  27. Chapter 12: Statement of Cash Flows
    1. Got Cash?
    2. The Statement of Cash Flows: Usefulness and Format
      1. Usefulness of the Statement of Cash Flows
      2. Classification of Cash Flows
      3. Significant Noncash Activities
      4. Format of the Statement of Cash Flows
      5. The Corporate Life Cycle
      6. Preparing the Statement of Cash Flows
      7. Indirect and Direct Methods
    3. Preparation of the Statement of Cash Flows—Indirect Method
      1. Step 1: Operating Activities
      2. Summary of Conversion to Net Cash Provided by Operating Activities—Indirect Methods
      3. Step 2: Investing and Financing Activities
      4. Step 3: Net Change in Cash
    4. Using Cash Flows to Evaluate a Company
      1. Free Cash Flow
    5. Keeping an Eye on Cash
      1. Assessing Liquidity and Solvency Using Cash Flows
    6. APPENDIX 12A: Statement of Cash Flows—Direct Method
      1. Step 1: Operating Activities
      2. Step 2: Investing and Financing Activities
      3. Step 3: Net Change in Cash
    7. APPENDIX 12B: Statement of Cash Flows—T-Account Approach
    8. A Look at IFRS
  28. Chapter 13: Financial Analysis: The Big Picture
    1. It Pays to Be Patient
    2. Sustainable Income
      1. Irregular Items
      2. Changes in Accounting Principle
      3. Comprehensive Income
      4. Concluding Remarks
    3. Comparative Analysis
      1. Horizontal Analysis
      2. Vertical Analysis
    4. Ratio Analysis
      1. Liquidity Ratios
      2. Solvency Ratios
      3. Profitability Ratios
    5. Quality of Earnings
      1. Alternative Accounting Methods
      2. Pro Forma Income
      3. Improper Recognition
      4. Price-Earnings Ratio
    6. APPENDIX 13A: Comprehensive Illustration of Ratio Analysis
      1. Liquidity Ratios
      2. Solvency Ratios
      3. Profitability Ratios
    7. A Look at IFRS
  29. Appendix A: Specimen Financial Statements: Tootsie Roll Industries, Inc.
    1. The Annual Report
    2. Letter to the Stockholders
    3. Financial Highlights
    4. Management Discussion and Analysis
    5. Financial Statements and Accompanying Notes
    6. Auditor's Report
  30. Appendix B: Specimen Financial Statements: The Hershey Company
  31. Appendix C: Specimen Financial Statements: Zetar plc
  32. Appendix D: Time Value of Money
    1. Nature of Interest
      1. Simple Interest
      2. Compound Interest
    2. Future Value Concepts
      1. Future Value of a Single Amount
      2. Future Value of an Annuity
    3. Present Value Concepts
      1. Present Value Variables
      2. Present Value of a Single Amount
      3. Present Value of an Annuity
      4. Time Periods and Discounting
      5. Computing the Present Value of a Long-Term Note or Bond
    4. Using Financial Calculators
      1. Present Value of a Single Sum
      2. Present Value of an Annuity
      3. Useful Applications of the Financial Calculator
  33. Appendix E: Reporting and Analyzing Investments
    1. Why Corporations Invest
    2. Accounting for Debt Investments
      1. Recording Acquisition of Bonds
      2. Recording Bond Interest
      3. Recording Sale of Bonds
    3. Accounting for Stock Investments
      1. Holdings of Less Than 20%
      2. Holdings Between 20% and 50%
      3. Holdings of More Than 50%
    4. Valuing and Reporting Investments
      1. Categories of Securities
      2. Balance Sheet Presentation
      3. Presentation of Realized and Unrealized Gain or Loss
      4. Statement of Cash Flows Presentation
  34. Company Index
  35. Subject Index

Product information

  • Title: Financial Accounting: Tools for Business Decision Making, 7th Edition
  • Author(s):
  • Release date: October 2012
  • Publisher(s): Wiley
  • ISBN: 9781118162286