Intermediate Accounting, 13th Canadian Edition,
(Volume 2) Donald Kieso, Jerry Weygandt, Terry
Warfield (Solutions Manual with Test Bank)
external users of accounting information - ✔✔ANSWER✔✔-
Investors, creditors, employees, labor unions, customers,
suppliers, government regulatory agencies, financial
intermediaries
financial accounting - ✔✔ANSWER✔✔-Provides relevant
financial information to various external users.
managerial accounting - ✔✔ANSWER✔✔-deals with the
concepts and methods used to provide information to an
organization's internal users
GAAP - ✔✔ANSWER✔✔-set of both broad and specific
guidelines that companies should follow when measuring and
reporting the information in their financial statements and related
notes
SEC - ✔✔ANSWER✔✔-responsible for setting accounting and
reporting standards for companies whose securities are publicly
traded
FASB - ✔✔ANSWER✔✔-the current private sector body that has
been delegated the task of setting accounting standards.
IASB - ✔✔ANSWER✔✔-objectives are to develop a single set of
high-quality understandable global accounting standards, to
promote the use of those standards, and to bring about the
,convergence of national accounting standards and international
accounting standards
IFRS - ✔✔ANSWER✔✔-developed by the IASB and used by
more than 100 countries
SOX - ✔✔ANSWER✔✔-law provides for the regulation of the key
players in the financial reporting process
Initial market transactions - ✔✔ANSWER✔✔-involves issuance of
stocks and bonds by the corporation
Secondary market transactions - ✔✔ANSWER✔✔-involves the
transfer of stocks and bonds between individuals and institutions
Maltec Corporation has started placing its quarterly financial
statements on its web page, thereby reducing by 10 days the time
to get information to investors and creditors. The qualitative
concept improved is: - ✔✔ANSWER✔✔-Timeliness
Timeliness - ✔✔ANSWER✔✔-information that is available to
users early enough to allow its use in the decision process
Consistency - ✔✔ANSWER✔✔-permits valid comparisons
between different periods
Faithful representation - ✔✔ANSWER✔✔-exists when there is
agreement between a measure or description and the
phenomenon it purports to represent
Comparability - ✔✔ANSWER✔✔-the ability to help users see
similarities and differences among events and conditions
,Astro Turf Company recognizes an expense, cost of goods sold,
in the period the product is manufactured. - ✔✔ANSWER✔✔-The
matching principle
Cloud Drug Company owns a patent that it purchased three years
ago for $2 million. The controller recently revalued the patent to
its approximate market value of $8 million. - ✔✔ANSWER✔✔-The
historical cost (original transaction value) principle
Philips Company pays the monthly mortgage on the home of its
president, Larry Crosswhite, and charges the expenditure to
miscellaneous expense. - ✔✔ANSWER✔✔-The economic entity
assumption
The economic entity assumption - ✔✔ANSWER✔✔-of an entity
be kept separated from activities of its owner
The matching principle - ✔✔ANSWER✔✔-expenses are
recognized in the same period as the related revenues
The historical cost principle - ✔✔ANSWER✔✔-original
transaction value
Liability - ✔✔ANSWER✔✔-Obligation to transfer cash or other
resources as a result of a past transaction.
distribution to owners - ✔✔ANSWER✔✔-Dividends paid by a
corporation to its shareholders.
revenue - ✔✔ANSWER✔✔-Inflow of an asset from providing a
good or service.
, Assets, liabilities and equity - ✔✔ANSWER✔✔-The financial
position of a company.
Comprehensive income - ✔✔ANSWER✔✔-Increase in equity
during a period from nonowner transactions.
Gain - ✔✔ANSWER✔✔-Increase in equity from peripheral or
incidental transaction.
Loss - ✔✔ANSWER✔✔-Sale of an asset used in the operations
of a business for less than the asset's book value.
Equity - ✔✔ANSWER✔✔-The owners' residual interest in the
assets of a company.
Asset - ✔✔ANSWER✔✔-An item owned by the company
representing probable future benefits.
Net income - ✔✔ANSWER✔✔-Revenues plus gains less
expenses and losses.
Investment by owner - ✔✔ANSWER✔✔-An owner's contribution
of cash to a corporation in exchange for ownership shares of
stock.
Expense - ✔✔ANSWER✔✔-Outflow of an asset related to the
production of revenue.
Economic entity assumption - ✔✔ANSWER✔✔-The enterprise is
separate from its owners and other entities.
Periodicity - ✔✔ANSWER✔✔-A common denominator is the
dollar.
(Volume 2) Donald Kieso, Jerry Weygandt, Terry
Warfield (Solutions Manual with Test Bank)
external users of accounting information - ✔✔ANSWER✔✔-
Investors, creditors, employees, labor unions, customers,
suppliers, government regulatory agencies, financial
intermediaries
financial accounting - ✔✔ANSWER✔✔-Provides relevant
financial information to various external users.
managerial accounting - ✔✔ANSWER✔✔-deals with the
concepts and methods used to provide information to an
organization's internal users
GAAP - ✔✔ANSWER✔✔-set of both broad and specific
guidelines that companies should follow when measuring and
reporting the information in their financial statements and related
notes
SEC - ✔✔ANSWER✔✔-responsible for setting accounting and
reporting standards for companies whose securities are publicly
traded
FASB - ✔✔ANSWER✔✔-the current private sector body that has
been delegated the task of setting accounting standards.
IASB - ✔✔ANSWER✔✔-objectives are to develop a single set of
high-quality understandable global accounting standards, to
promote the use of those standards, and to bring about the
,convergence of national accounting standards and international
accounting standards
IFRS - ✔✔ANSWER✔✔-developed by the IASB and used by
more than 100 countries
SOX - ✔✔ANSWER✔✔-law provides for the regulation of the key
players in the financial reporting process
Initial market transactions - ✔✔ANSWER✔✔-involves issuance of
stocks and bonds by the corporation
Secondary market transactions - ✔✔ANSWER✔✔-involves the
transfer of stocks and bonds between individuals and institutions
Maltec Corporation has started placing its quarterly financial
statements on its web page, thereby reducing by 10 days the time
to get information to investors and creditors. The qualitative
concept improved is: - ✔✔ANSWER✔✔-Timeliness
Timeliness - ✔✔ANSWER✔✔-information that is available to
users early enough to allow its use in the decision process
Consistency - ✔✔ANSWER✔✔-permits valid comparisons
between different periods
Faithful representation - ✔✔ANSWER✔✔-exists when there is
agreement between a measure or description and the
phenomenon it purports to represent
Comparability - ✔✔ANSWER✔✔-the ability to help users see
similarities and differences among events and conditions
,Astro Turf Company recognizes an expense, cost of goods sold,
in the period the product is manufactured. - ✔✔ANSWER✔✔-The
matching principle
Cloud Drug Company owns a patent that it purchased three years
ago for $2 million. The controller recently revalued the patent to
its approximate market value of $8 million. - ✔✔ANSWER✔✔-The
historical cost (original transaction value) principle
Philips Company pays the monthly mortgage on the home of its
president, Larry Crosswhite, and charges the expenditure to
miscellaneous expense. - ✔✔ANSWER✔✔-The economic entity
assumption
The economic entity assumption - ✔✔ANSWER✔✔-of an entity
be kept separated from activities of its owner
The matching principle - ✔✔ANSWER✔✔-expenses are
recognized in the same period as the related revenues
The historical cost principle - ✔✔ANSWER✔✔-original
transaction value
Liability - ✔✔ANSWER✔✔-Obligation to transfer cash or other
resources as a result of a past transaction.
distribution to owners - ✔✔ANSWER✔✔-Dividends paid by a
corporation to its shareholders.
revenue - ✔✔ANSWER✔✔-Inflow of an asset from providing a
good or service.
, Assets, liabilities and equity - ✔✔ANSWER✔✔-The financial
position of a company.
Comprehensive income - ✔✔ANSWER✔✔-Increase in equity
during a period from nonowner transactions.
Gain - ✔✔ANSWER✔✔-Increase in equity from peripheral or
incidental transaction.
Loss - ✔✔ANSWER✔✔-Sale of an asset used in the operations
of a business for less than the asset's book value.
Equity - ✔✔ANSWER✔✔-The owners' residual interest in the
assets of a company.
Asset - ✔✔ANSWER✔✔-An item owned by the company
representing probable future benefits.
Net income - ✔✔ANSWER✔✔-Revenues plus gains less
expenses and losses.
Investment by owner - ✔✔ANSWER✔✔-An owner's contribution
of cash to a corporation in exchange for ownership shares of
stock.
Expense - ✔✔ANSWER✔✔-Outflow of an asset related to the
production of revenue.
Economic entity assumption - ✔✔ANSWER✔✔-The enterprise is
separate from its owners and other entities.
Periodicity - ✔✔ANSWER✔✔-A common denominator is the
dollar.
