FINANCIAL ACCOUNTING FOR MANAGERS 1ST EDITION BY WAYNE THOMAS
AND DAVID SPICELAND AND MARK NELSON
CHAPTER 1 U
U A FRAMEWORK FOR FINANCIAL ACCOUNTING
U U U U
U REAL WORLD PERSPECTIVES
U U
RWP1-1 EDGAR Nike (ticker: NKE)
U U U U
RequirementU1
a. $23,717Umillion
b. $9,040Umillion
c. TotalUliabilitiesU=UTotalUassetsU–UtotalUshareholder’sUequity
$23,717U–U$9,040U=U$14,677Umillion
RequirementU2
a. $39,117Umillion.URevenueUincreasedUfromUtheUpreviousUyear.
b. $4,029Umillion.UNetUincomeUincreasedUfromUtheUpreviousUyear
.
RequirementU3
a. OperatingUcashUflowU=U$5,903Umillion.UOperatingUcashUflowUwasUmoreUpositive
thanUtheUpreviousUyear.
b. InvestingUcashUflowU=U−$264Umillion.UInvestingUcashUflowUwentUfromUpositiveUt
oUnegativeUfromUtheUpreviousUyear.
c. FinancingUcashUflowU=U−$5,293Umillion.UFinancingUcashUflowUwasUmoreUnegativ
e
thanUtheUpreviousUyear.
RWP1-2 EDGAR Netflix Inc (ticker: NFLX)
U U U U U
RequirementU1
a. AverageUpayingUmembershipUincreasedUbyU23%UandUaverageUmonthlyUrevenueUpe
r
payingUmembershipUincreasedUbyU5%.
b. $2,795,434U/U$20,156,447U=U13.9%
c. $2,652,462,U13%UofUrevenues
RequirementU2
a. $9,801,215U/U$24,504,567U=U40%
b. $33,141Umillion
©McGrawUHillULLC.UAllUrightsUreserved.UNoUreproductionUorUfurtherUdistributionUpermittedUwithoutUtheUpriorUwrittenUconsentUofUMcGraw
UHillULLCUManual,U Chapter
Solutions 5-1
U5
,©McGrawUHillULLC.UAllUrightsUreserved.UNoUreproductionUorUfurtherUdistributionUpermittedUwithoutUtheUpriorUwrittenUconsentUofUMcGra
wUHillULLC
5-2 FinancialUAccountingUforUManage
rs
,RequirementU3
a. $20,723,441.U Long-
termUdebtUwentUupUfromUtheUpreviousUyear.
b. $736,969
RequirementU4
9%
RequirementU5
a. ErnstU&UYoungULLP
b. Yes
RWP1-3 EDGAR General Mills Inc. (ticker: GIS)
U U U U U U
RequirementU1
FirstUQuarter.
RequirementU2
AugustU26,U2018.U TheUsameUquarterUofUlastUyearUisUusedUasUtheUcomparisonUquarter.
RequirementU3
TheUquarterlyUreportUincludesU15Unotes.
RWP1-4 EDGAR Nordstrom Inc. (ticker: JWN)
U U U U U
RequirementU1
TheUCOVID-19Upandemic.
RequirementU2
OnUMarchU23,U2020,UtheUCompanyUannouncedUthatUitUwouldUbeUtakingUseveralUstepsUinUanUabunda
nceUofUcautionUtoUproactivelyUstrengthenUitsUfinancialUflexibilityUandUnavigateUthroughUthisUunprece
dentedUsituation.USpecifically,UtheUCompanyUsuspendedUitsUquarterlyUdividendUbeginningUinUtheUsec
ondUquarterUofU2020,UdrewUdownU$800UmillionUonUitsURevolvingUCreditUFacility,UtargetedUfurtherUr
eductionsUofUmoreUthanU$500UmillionUinUoperatingUexpenses,UcapitalUexpenditures,UandUworkingUca
pital,UandUsuspendedUshareUrepurchases.
©McGrawUHillULLC.UAllUrightsUreserved.UNoUreproductionUorUfurtherUdistributionUpermittedUwithoutUtheUpriorUwrittenUconsentUofUMcGraw
UHillULLCUManual,U Chapter
Solutions 5-3
U5
, RWP1-5 Financial Analysis: American Eagle
U U U U
($UinUthousands)
RequirementU1
TotalUassets =U$3,328,679
TotalUliabilities
=U$2,080,82
6UStockholders’Uequity
=U$1,247,85
3
Assets = Liabilities + Stockholders’UEquity
$3,328,679 = $2,080,826 + $1,247,853
RequirementU2
ConsolidatedUStatementsUofUOperations
RequirementU3
NetUsales =U$4,308,212
NetUincome =U$191,257
RequirementU4
Inflows Outflows
InvestingUactivities SaleUofUavailable-for- CapitalUexpendituresUfor
sale propertyUandUequipment
investments
FinancingUactivities NetUproceedsUfromUstoc RepurchaseUofUcommonUstoc
kUoptionsUexercised k
RequirementU5
TheUcompany’sUauditorUisUErnstU&UYoungULLP.
TheUauditorUstates,U―WeUhaveUauditedUtheUaccompanyingUconsolidatedUbalanceUsheetsUofUAmerican
UEagleUOutfitters,U Inc.U(theUCompany)UasUofUFebruaryU1,U2020UandUFebruaryU2,U2019,UtheUrelatedUc
onsolidatedUstatementsUofUoperations,UcomprehensiveUincome,Ustockholders’UequityUandUcashUflows
UforUeachUofUtheUthreeU yearsUinUtheUperiodUendedUFebruaryU1,U2020,UandUtheUrelatedUnotesU(collecti
velyUreferredUtoUasUtheU―consolidatedUfinancialUstatements‖).UInUourUopinion,UtheUconsolidatedUfinan
cialUstatementsUpresentUfairly,UinUallUmaterialUrespects,UtheUfinancialUpositionUofUtheUCompanyUatUF
ebruaryU1,U2020UandUFebruaryU2,U2019,UandUtheUresultsUofUitsUoperationsUandUitsUcashUflowsUforUeac
hUofUtheUthreeUyearsUinUtheUperiodUendedUFebruaryU1,U2020,UinUconformityUwithUU.S.UgenerallyUacce
ptedUaccountingUprinciples.‖
©McGrawUHillULLC.UAllUrightsUreserved.UNoUreproductionUorUfurtherUdistributionUpermittedUwithoutUtheUpriorUwrittenUconsentUofUMcGra
wUHillULLC
5-4 FinancialUAccountingUforUManage
rs
AND DAVID SPICELAND AND MARK NELSON
CHAPTER 1 U
U A FRAMEWORK FOR FINANCIAL ACCOUNTING
U U U U
U REAL WORLD PERSPECTIVES
U U
RWP1-1 EDGAR Nike (ticker: NKE)
U U U U
RequirementU1
a. $23,717Umillion
b. $9,040Umillion
c. TotalUliabilitiesU=UTotalUassetsU–UtotalUshareholder’sUequity
$23,717U–U$9,040U=U$14,677Umillion
RequirementU2
a. $39,117Umillion.URevenueUincreasedUfromUtheUpreviousUyear.
b. $4,029Umillion.UNetUincomeUincreasedUfromUtheUpreviousUyear
.
RequirementU3
a. OperatingUcashUflowU=U$5,903Umillion.UOperatingUcashUflowUwasUmoreUpositive
thanUtheUpreviousUyear.
b. InvestingUcashUflowU=U−$264Umillion.UInvestingUcashUflowUwentUfromUpositiveUt
oUnegativeUfromUtheUpreviousUyear.
c. FinancingUcashUflowU=U−$5,293Umillion.UFinancingUcashUflowUwasUmoreUnegativ
e
thanUtheUpreviousUyear.
RWP1-2 EDGAR Netflix Inc (ticker: NFLX)
U U U U U
RequirementU1
a. AverageUpayingUmembershipUincreasedUbyU23%UandUaverageUmonthlyUrevenueUpe
r
payingUmembershipUincreasedUbyU5%.
b. $2,795,434U/U$20,156,447U=U13.9%
c. $2,652,462,U13%UofUrevenues
RequirementU2
a. $9,801,215U/U$24,504,567U=U40%
b. $33,141Umillion
©McGrawUHillULLC.UAllUrightsUreserved.UNoUreproductionUorUfurtherUdistributionUpermittedUwithoutUtheUpriorUwrittenUconsentUofUMcGraw
UHillULLCUManual,U Chapter
Solutions 5-1
U5
,©McGrawUHillULLC.UAllUrightsUreserved.UNoUreproductionUorUfurtherUdistributionUpermittedUwithoutUtheUpriorUwrittenUconsentUofUMcGra
wUHillULLC
5-2 FinancialUAccountingUforUManage
rs
,RequirementU3
a. $20,723,441.U Long-
termUdebtUwentUupUfromUtheUpreviousUyear.
b. $736,969
RequirementU4
9%
RequirementU5
a. ErnstU&UYoungULLP
b. Yes
RWP1-3 EDGAR General Mills Inc. (ticker: GIS)
U U U U U U
RequirementU1
FirstUQuarter.
RequirementU2
AugustU26,U2018.U TheUsameUquarterUofUlastUyearUisUusedUasUtheUcomparisonUquarter.
RequirementU3
TheUquarterlyUreportUincludesU15Unotes.
RWP1-4 EDGAR Nordstrom Inc. (ticker: JWN)
U U U U U
RequirementU1
TheUCOVID-19Upandemic.
RequirementU2
OnUMarchU23,U2020,UtheUCompanyUannouncedUthatUitUwouldUbeUtakingUseveralUstepsUinUanUabunda
nceUofUcautionUtoUproactivelyUstrengthenUitsUfinancialUflexibilityUandUnavigateUthroughUthisUunprece
dentedUsituation.USpecifically,UtheUCompanyUsuspendedUitsUquarterlyUdividendUbeginningUinUtheUsec
ondUquarterUofU2020,UdrewUdownU$800UmillionUonUitsURevolvingUCreditUFacility,UtargetedUfurtherUr
eductionsUofUmoreUthanU$500UmillionUinUoperatingUexpenses,UcapitalUexpenditures,UandUworkingUca
pital,UandUsuspendedUshareUrepurchases.
©McGrawUHillULLC.UAllUrightsUreserved.UNoUreproductionUorUfurtherUdistributionUpermittedUwithoutUtheUpriorUwrittenUconsentUofUMcGraw
UHillULLCUManual,U Chapter
Solutions 5-3
U5
, RWP1-5 Financial Analysis: American Eagle
U U U U
($UinUthousands)
RequirementU1
TotalUassets =U$3,328,679
TotalUliabilities
=U$2,080,82
6UStockholders’Uequity
=U$1,247,85
3
Assets = Liabilities + Stockholders’UEquity
$3,328,679 = $2,080,826 + $1,247,853
RequirementU2
ConsolidatedUStatementsUofUOperations
RequirementU3
NetUsales =U$4,308,212
NetUincome =U$191,257
RequirementU4
Inflows Outflows
InvestingUactivities SaleUofUavailable-for- CapitalUexpendituresUfor
sale propertyUandUequipment
investments
FinancingUactivities NetUproceedsUfromUstoc RepurchaseUofUcommonUstoc
kUoptionsUexercised k
RequirementU5
TheUcompany’sUauditorUisUErnstU&UYoungULLP.
TheUauditorUstates,U―WeUhaveUauditedUtheUaccompanyingUconsolidatedUbalanceUsheetsUofUAmerican
UEagleUOutfitters,U Inc.U(theUCompany)UasUofUFebruaryU1,U2020UandUFebruaryU2,U2019,UtheUrelatedUc
onsolidatedUstatementsUofUoperations,UcomprehensiveUincome,Ustockholders’UequityUandUcashUflows
UforUeachUofUtheUthreeU yearsUinUtheUperiodUendedUFebruaryU1,U2020,UandUtheUrelatedUnotesU(collecti
velyUreferredUtoUasUtheU―consolidatedUfinancialUstatements‖).UInUourUopinion,UtheUconsolidatedUfinan
cialUstatementsUpresentUfairly,UinUallUmaterialUrespects,UtheUfinancialUpositionUofUtheUCompanyUatUF
ebruaryU1,U2020UandUFebruaryU2,U2019,UandUtheUresultsUofUitsUoperationsUandUitsUcashUflowsUforUeac
hUofUtheUthreeUyearsUinUtheUperiodUendedUFebruaryU1,U2020,UinUconformityUwithUU.S.UgenerallyUacce
ptedUaccountingUprinciples.‖
©McGrawUHillULLC.UAllUrightsUreserved.UNoUreproductionUorUfurtherUdistributionUpermittedUwithoutUtheUpriorUwrittenUconsentUofUMcGra
wUHillULLC
5-4 FinancialUAccountingUforUManage
rs
