Summary Accounting I EBE + IBA + BA + BK VU 2021

FULL SOLUTION MANUAL FOR vh vh vh




Financial And Managerial Accounting 4th Edition by Jerry J vh vh vh vh vh vh vh vh




Weygandt, Paul D Kimmel, Jill E Mitchel
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CHAPTER 1 vh




Accounting in Action v h v h




ASSIGNMENT CLASSIFICATION TABLE v h v h




Brief A
Learning v h Objectives v h Questions Exercises v h Do v h It! Problems
v Exercises
h




1. Identify the v h 1, v h 2, v h 3, 5 1 1, 2
activities
v h v h 4,
and users associated
vh v h



with accounting. v h




2. Explain
v h v h the v h v h v h blocks 6, v h 7, v h 8, 2 3, 4
building
v h v h 9,
of accounting: ethics, 10
principles, and
assumptions.

3. State the v h 11, 13, 1, 2, 3, 4, 5 3 5
accounting v h v 12,h



equation, and v h 14.
define v h



its components.
vh 22

4. Analyze the v h v h effects 15, 16, 18 6, 7, 8, 9 4 6, 7, 8 1A, 2A, v h


v of
h v 4A,
h


business on 5A
transactions
v h



the accounting vh v h equation.

5. v h Describe the four financial vh vh vh 17, 19, v h 10, 11 v h 5 8, v h 9, v h 10, 2A, v h 3A, v h 4A
statements and how they
vh vh vh vh 20,
v h v 11,
h
5A
are prepared.
vh vh
21, 12, 13, v h


14,
v h


15,
16, 17, v h


18
v h




obtain permission to reuse this material is available at
vh vh vh vh vh vh vh vh


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,1-2 © vh2021 vhJohn vhWiley vh& vhSons, vhInc. vhAll vhrights vhreserved. v h Weygandt, vhFinancial vh& vhManagerial vhAccounting vh4e, vhSolutions vhManual (For
Instructor Use Only)

,© v h2021 John Wileyv h & Sons, Inc. Allv rights
h reserved. v Noh part v h v h v h v h v h v h v h v h of v this
h publication v h


v h may be v reproduced,
h stored
v inh a retrieval system, or transmitted, in
v h v h v h vh v h v h v h vh v h any form
v h or by v h v h


v h any means,
v h electronic, mechanical, photocopying,
v h recording or otherwise,
v h v h v h v h vh v h except as v h


v h permitted by law. Advice
v h on how to
v h v h v h v h v h




obtain permission to reuse this material is available at
vh vh vh vh vh vh vh vh


http://www.wiley.com/go/permissions.

, ANSWERS TO QUESTIONS v h v h




1. True. Virtually every organization and person in our society uses accounting information.
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Businesses,
vh investors, creditors, government agencies, and not-for-profit v h v h v h v h v h v h



v organizations must use accounting information to operate effectively.
h vh v h v h v h v h v h v h



LO 1,
v h v h v h v h BT: v h v h K, v h v h Difficulty: v h v h Easy, v h v h TOT: v h v h 2 v h v h min., v h v h AACSB: v h v h None, v h v h AICPA v h v h FC: v h v h Reporting, v h v h IMA:
Reporting
v h




2. Accounting is the process of identifying, recording, and v communicating
h v h v h v h v h v h v h v h



v the economic events of an organization to interested users of the information. The first
h v h vh vh vh vh vh vh vh vh vh vh vh vh



activity of the accounting
vh process is to identify
vh economicvh events that are vh v h v h v h v h v h v h v h v h



v relevant
h to a particular business. Once identified and vmeasured,
h the v h v h vh v h v h v h v h v h



v events are recorded to provide a history of the financial activities of
h v h v h v h v h v h v h vh v h v h v h v h



v the organization. Recording consists of keeping a chronological diary of these
h v h v h v h v h v h v h vh vh vh vh



measured events in an orderly and systematic manner. The information is communicated
vh vh vh vh vh vh vh vh vh vh v h v h



v through
h the preparation and distribution of accounting reports,
v h the v h v h v h v h v h vh v h v h v h



v mosth common of which are v called
h financialv statements. A
h v h v h v h v h v h v h v h v h v h v h



v vital element in the communication process is the accountant’s ability and
h vh v h v h v h v h v h v h v h v h v h



responsibility to analyze and interpret the reported information.
v h v h vh v h v h v h v h v h



LO 1,
v h v h v h v h BT: v h v h K, v h v h Difficulty: v h v h Easy, v h v h TOT: v h v h 2 v h v h min., v h v h AACSB: v h v h None, v h v h AICPA v h v h FC: v h v h Reporting, v h v h IMA:
Reporting
v h




3. (a) v h Internal users are those who plan, organize, and run the business and
v h v h v h v h v h v h v h v h v h v h v h



therefore are officers and other decision makers.
v h v h vh v h v h v h v h



(b) v hTo assist management, accounting
v provides
h internal reports. Examples v h v h v h v h v h v h



include financial
v h comparisons of operating alternatives, projections
vh of v h v h v h v h v h v h v h



income
v h from new sales campaigns, and forecasts of cash
v needs
h v h vh v h v h v h v h v h v h



for the next year.
v h v h v h v h



LO 1,
v h v h v h v h BT: v h v h K, v h v h Difficulty: v h v h Easy, v h v h TOT: v h v h 2 v h v h min., v h v h AACSB: v h v h None, v h v h AICPA v h v h FC: v h v h Reporting, v h v h IMA
Reporting
v h




4. (a) v h Investors decisions to buy, v h (owners) v h use v h accounting v h information v h to v h make v h v h v h



hold, or sell v h v h v h



stock.
(b) Creditors use accounting information to evaluate the risks of granting credit or v h v h v h v h v h v h v h v h v h v h v h



lending money. v h v h



LO 1,
v h v h v h v h BT: v h v h K, v h v h Difficulty: v h v h Easy, v h v h TOT: v h v h 2 v h v h min., v h v h AACSB: v h v h None, v h v h AICPA v h v h FC: v h v h Reporting, v h v h IMA:
Reporting
v h




5. False. Bookkeeping usually involves only the recording of economic events
v h v h v h v h v h v h v h v h v h



v andh therefore is just one part of the
v entire
h accounting process. vh v h v h v h v h v h v h v h v h



v Accounting,
h on the other hand, involves the entire process of v h v h v h v h vh v h v h v h v h



v identifying, recording, and communicating economic events.
h v h v h v h v h v h



LO 1,
v h v h v h v h BT: v h v h C, v h v h Difficulty: v h v h Easy, v h v h TOT: v h v h 2 v h v h min., v h v h AACSB: v h v h None, v h v h AICPA v h v h FC: v h v h Reporting, v h v h IMA
Reporting
v h




6. Harper Travel Agency should report
v the h land at $85,000 on its v h v h v h v h v h v h v h v h v h



vDecember
h 31, 2022 balance sheet. This is true not only vat the
h v h vh v h v h v h v h v h v h v h v h



vtime h the land is purchased, butv also hover the time the land is held. v h v h v h v h v h v h vh v h v h v h v h v h



vIn determining which measurement principle to use (historical cost
h v h or fair v h v h v h v h v h v h v h v h v h



vvalue)
h companies weigh the factual nature vof hcost figures versus v h v h v h v h v h v h v h v h



vthe relevance
h of fair value.
vh In general, companies use historical cost. v h v h v h v h v h v h v h v h v h



vOnly h in situations where assets are vactively
h traded do vcompanies
h vh v h v h v h v h v h v h v h




1-4 © vh2021 vhJohn vhWiley vh& vhSons, vhInc. vhAll vhrights vhreserved. v h Weygandt, vhFinancial vh& vhManagerial vhAccounting vh4e, vhSolutions vhManual (For
Instructor Use Only)