SOLUTION MANUAL FOR M M
FINANCIALMACCOUNTINGMFORMMANAGERSM1STMEDITIONMBYMWAYNEMTHO
MASMANDMDAVIDMSPICELANDMANDMMARKMNELSON
CHAPTER 1 M
M A FRAMEWORK FOR FINANCIAL ACCOUNTING
M M M M
M REAL WORLD PERSPECTIVES
M M
RWP1-1 EDGAR Nike (ticker: NKE)
M M M M
RequirementM1
a. $23,717Mmillion
b. $9,040Mmillion
c. TotalMliabilitiesM=MTotalMassetsM–
MtotalMshareholder’s Mequity
$23,717M–M$9,040M=M$14,677Mmillion
RequirementM2
a. $39,117Mmillion.MRevenueMincreasedMfromMtheMpreviousMyear.
b. $4,029Mmillion.MNetMincomeMincreasedMfromMtheMpreviousMye
ar.
RequirementM3
a. OperatingMcashMflowM=M$5,903Mmillion.MOperatingMcashMflowMwasMmoreMpositiv
e
thanMtheMpreviousMyear.
b. InvestingMcashMflowM=M−$264Mmillion.MInvestingMcashMflowMwentMfromMpositiv
eMtoMnegativeMfromMtheMpreviousM year.
c. FinancingMcashMflowM=M−$5,293Mmillion.MFinancingMcashMflowMwasMmoreMnega
tive
thanMtheMpreviousMyear.
RWP1-2 EDGAR Netflix Inc (ticker: NFLX)
M M M M M
RequirementM1
a. AverageMpayingMmembershipMincreasedMbyM23%MandMaverageMmonthlyMrevenueM
per
payingMmembershipMincreasedMbyM5%.
b. $2,795,434M/M$20,156,447M=M13.9%
c. $2,652,462,M13%MofMrevenues
RequirementM2
©McGrawMHillMLLC.MAllMrightsMreserved.MNoMreproductionMorMfurtherMdistributionMpermittedMwithoutMtheMpriorMwrittenMconsentMofMMcGr
awMHillMLLC
Solutions MManual,M Chapter 5-1
M5
, a. $9,801,215M/M$24,504,567M=M40%
b. $33,141Mmillion
©McGrawMHillMLLC.MAllMrightsMreserved.MNoMreproductionMorMfurtherMdistributionMpermittedMwithoutMtheMpriorMwrittenMconsentMofMMc
GrawMHillMLLC
5-2 FinancialMAccountingMforMManage
rs
,©McGrawMHillMLLC.MAllMrightsMreserved.MNoMreproductionMorMfurtherMdistributionMpermittedMwithoutMtheMpriorMwrittenMconsentMofMMcGr
awMHillMLLC
Solutions MManual,M Chapter 5-3
M5
, RequirementM3
a. $20,723,441.M Long-
termMdebtMwentMupMfromMtheMpreviousMyear.
b. $736,969
RequirementM4
9%
RequirementM5
a. ErnstM&MYoungMLLP
b. Yes
RWP1-3 EDGAR General Mills Inc. (ticker: GIS)
M M M M M M
RequirementM1
FirstMQuarter.
RequirementM2
AugustM26,M2018.M TheMsameMquarterMofMlastMyearMisMusedMasMtheMcomparisonMquarter.
RequirementM3
TheMquarterlyMreportMincludesM15Mnotes.
RWP1-4 EDGAR Nordstrom Inc. (ticker: JWN)
M M M M M
RequirementM1
TheMCOVID-19Mpandemic.
RequirementM2
OnMMarchM23,M2020,MtheMCompanyMannouncedMthatMitMwouldMbeMtakingMseveralMstepsMinManMabu
ndanceMofMcautionMtoMproactivelyMstrengthenMitsMfinancialMflexibilityMandMnavigateMthroughMthisMun
precedentedMsituation.MSpecifically,MtheMCompanyMsuspendedMitsMquarterlyMdividendMbeginningMin
MtheMsecondMquarterMofM2020,MdrewMdownM$800MmillionMonMitsMRevolvingMCreditMFacility,Mtarget
edMfurtherMreductionsMofMmoreMthanM$500MmillionMinMoperatingMexpenses,McapitalMexpenditures,Ma
ndMworkingMcapital,MandMsuspendedMshareMrepurchases.
©McGrawMHillMLLC.MAllMrightsMreserved.MNoMreproductionMorMfurtherMdistributionMpermittedMwithoutMtheMpriorMwrittenMconsentMofMMc
GrawMHillMLLC
5-4 FinancialMAccountingMforMManage
rs
FINANCIALMACCOUNTINGMFORMMANAGERSM1STMEDITIONMBYMWAYNEMTHO
MASMANDMDAVIDMSPICELANDMANDMMARKMNELSON
CHAPTER 1 M
M A FRAMEWORK FOR FINANCIAL ACCOUNTING
M M M M
M REAL WORLD PERSPECTIVES
M M
RWP1-1 EDGAR Nike (ticker: NKE)
M M M M
RequirementM1
a. $23,717Mmillion
b. $9,040Mmillion
c. TotalMliabilitiesM=MTotalMassetsM–
MtotalMshareholder’s Mequity
$23,717M–M$9,040M=M$14,677Mmillion
RequirementM2
a. $39,117Mmillion.MRevenueMincreasedMfromMtheMpreviousMyear.
b. $4,029Mmillion.MNetMincomeMincreasedMfromMtheMpreviousMye
ar.
RequirementM3
a. OperatingMcashMflowM=M$5,903Mmillion.MOperatingMcashMflowMwasMmoreMpositiv
e
thanMtheMpreviousMyear.
b. InvestingMcashMflowM=M−$264Mmillion.MInvestingMcashMflowMwentMfromMpositiv
eMtoMnegativeMfromMtheMpreviousM year.
c. FinancingMcashMflowM=M−$5,293Mmillion.MFinancingMcashMflowMwasMmoreMnega
tive
thanMtheMpreviousMyear.
RWP1-2 EDGAR Netflix Inc (ticker: NFLX)
M M M M M
RequirementM1
a. AverageMpayingMmembershipMincreasedMbyM23%MandMaverageMmonthlyMrevenueM
per
payingMmembershipMincreasedMbyM5%.
b. $2,795,434M/M$20,156,447M=M13.9%
c. $2,652,462,M13%MofMrevenues
RequirementM2
©McGrawMHillMLLC.MAllMrightsMreserved.MNoMreproductionMorMfurtherMdistributionMpermittedMwithoutMtheMpriorMwrittenMconsentMofMMcGr
awMHillMLLC
Solutions MManual,M Chapter 5-1
M5
, a. $9,801,215M/M$24,504,567M=M40%
b. $33,141Mmillion
©McGrawMHillMLLC.MAllMrightsMreserved.MNoMreproductionMorMfurtherMdistributionMpermittedMwithoutMtheMpriorMwrittenMconsentMofMMc
GrawMHillMLLC
5-2 FinancialMAccountingMforMManage
rs
,©McGrawMHillMLLC.MAllMrightsMreserved.MNoMreproductionMorMfurtherMdistributionMpermittedMwithoutMtheMpriorMwrittenMconsentMofMMcGr
awMHillMLLC
Solutions MManual,M Chapter 5-3
M5
, RequirementM3
a. $20,723,441.M Long-
termMdebtMwentMupMfromMtheMpreviousMyear.
b. $736,969
RequirementM4
9%
RequirementM5
a. ErnstM&MYoungMLLP
b. Yes
RWP1-3 EDGAR General Mills Inc. (ticker: GIS)
M M M M M M
RequirementM1
FirstMQuarter.
RequirementM2
AugustM26,M2018.M TheMsameMquarterMofMlastMyearMisMusedMasMtheMcomparisonMquarter.
RequirementM3
TheMquarterlyMreportMincludesM15Mnotes.
RWP1-4 EDGAR Nordstrom Inc. (ticker: JWN)
M M M M M
RequirementM1
TheMCOVID-19Mpandemic.
RequirementM2
OnMMarchM23,M2020,MtheMCompanyMannouncedMthatMitMwouldMbeMtakingMseveralMstepsMinManMabu
ndanceMofMcautionMtoMproactivelyMstrengthenMitsMfinancialMflexibilityMandMnavigateMthroughMthisMun
precedentedMsituation.MSpecifically,MtheMCompanyMsuspendedMitsMquarterlyMdividendMbeginningMin
MtheMsecondMquarterMofM2020,MdrewMdownM$800MmillionMonMitsMRevolvingMCreditMFacility,Mtarget
edMfurtherMreductionsMofMmoreMthanM$500MmillionMinMoperatingMexpenses,McapitalMexpenditures,Ma
ndMworkingMcapital,MandMsuspendedMshareMrepurchases.
©McGrawMHillMLLC.MAllMrightsMreserved.MNoMreproductionMorMfurtherMdistributionMpermittedMwithoutMtheMpriorMwrittenMconsentMofMMc
GrawMHillMLLC
5-4 FinancialMAccountingMforMManage
rs
