,TABLE OF CONTENTS
Chapter 1. Accounting In Action
Chapter 2. The Recording Process
Chapter 3. Adjusting The Accounts
Chapter 4. Completing The Accounting Cycle
Chapter 5. Accounting For Merchandising Operations
Chapter 6. Inventories
Chapter 7. Fraud, Internal Control And Cash
Chapter 8. Accounting For Receivables
Chapter 9. Plant Assets, Natural Resources And Intangible Assets
Chapter 10. Liabilities
Chapter 11. Corporations: Organisations, Stock Transactions And Stockholders’ Eq
Uity
Chapter 12. Statement Of Cash Flows
Chapter 13. Financial Analysis: The Big Picture
,Chapter 1
Accounting In Action
Assignment Classification Table
Brief Exerci A
Learning Objectives Questions Ses Do It! Exercises Problems
1. 1, 2, 3, 4, 5 1 1, 2
Identify The Activities
And Users Associated
With Acco Unting.
2. Explain The Building Blocks 6, 7, 8, 9, 10 2 3, 4
Of Acco Unting: Ethics,
Principles,And As
Sumptions.
3. 11, 12, 13, 14. 1, 2, 3, 4, 5 3 5
State The 22
Accounting Eq
Uation, And Define
Itsco Mponents.
4. 15, 16, 18 6, 7, 8, 9 4 6, 7, 8 1a, 2a, 4a,
Analyze The Effects Of 5a
Busines S Transactions On
Theaccountin G Equation.
5. 17, 19, 20, 21, 10, 11 5 8, 9, 10, 11, 2a, 3a, 4a,
Describe The Four Financial 12, 13, 14, 15, 5a
Stat Ements And How They 16, 17, 18
Areprep Ared.
, ANSWERS TO QUESTIONS
1.True. Virtually Every Organization And Person In Our Society Uses Accounting Information.
Businesses, Inve Stors, Creditors, Government Agencies, And Not-For-
Profit Organizations Must Use Accounting Information To Operate Effectively.
Lo 1, Bt: K, Difficulty: Easy, Tot: 2 Min., Aacsb: None, Aicpa Fc: Reporting, Ima: Reporting
2. Accounting Is The Process Of Identifying, Recording, And Communicating The Economic Events Of An
Organ Ization To Interested Users Of The Information. The First Activity Of The Accounting Process Is
To Identify Eco Nomic Events That Are Relevant To A Particular Business. Once Identified And
Measured, The Events Are Rec Orded To Provide A History Of The Financial Activities Of The
Organization. Recording Consists Of Keeping A C Hronological Diary Of These Measured Events In
Anorderly And Systematic Manner. The Information Is Com Municated Through The Preparation And
Distribution Of Accounting Reports, The Most Common Of Whic H Are Called Financial
Statements.A Vital Element In The Communication Process Is The Accountant‟s Ability And
Responsibility To Analyze And Interpret The Reported Information.
Lo 1, Bt: K, Difficulty: Easy, Tot: 2 Min., Aacsb: None, Aicpa Fc: Reporting, Ima: Reporting
3.(A) Internal Users Are Those Who Plan, Organize, And Run The Business And Therefore Are Officers
And Other Decision Makers.
(B) To Assist Management, Accounting Provides Internal Reports. Examples Include Financial
Comparison S Of Operating Alternatives, Projections Of Income From New Sales
Campaigns,And Forecasts Of Cash Needs For The Next Year.
Lo 1, Bt: K, Difficulty: Easy, Tot: 2 Min., Aacsb: None, Aicpa Fc: Reporting, Ima: Reporting
4.
(A) Investors (Owners) Use Accounting Information To Make Decisions To Buy, Hold, Or Sell Stock.
(B) Creditors2use Accounting Information To Evaluate The Risks Of Granting Credit Or Lending Money.
Lo 1, Bt: K, Difficulty: Easy, Tot: 2 Min., Aacsb: None, Aicpa Fc: Reporting, Ima: Reporting
5.False. Bookkeeping Usually Involves Only The Recording Of Economic Events And Therefore Is Just
One Part Of The Entire Accounting Process. Accounting, On The Other Hand, Involves The Entire
Process Of Identifying
, Recording, And Communicating Economic Events.
Lo 1, Bt: C, Difficulty: Easy, Tot: 2 Min., Aacsb: None, Aicpa2 Fc: Reporting, Ima: Reporting
6. Harper Travel Agency Should Report The Land At $85,000 On Its December 31, 2022 Balance Sheet.
This Is True Not Only At The Time The Land Is Purchased, But Also Over The Time The Land Is Held. In
Determining Whi Ch Measurement Principle To Use (Historical Cost Or Fair Value) Companies Weigh
The Factual Nature Of Cost Figures Versus The Relevance Of Fair Value. In General, Companies Use
Historical Cost. Only In Situations Whe Re Assets Are Actively Traded Do Companies Apply The Fair
Value Principle.
Lo 2, Bt: C, Difficulty: Easy, Tot: 2 Min., Aacsb: None, Aicpa Fc: Measurement, Analysis And Interpretation Ima: Report
7. The Monetary Unit Assumption Requires That Only Transaction Data Capable Of Being Expressed In
Terms Of Money Be Included In The Accounting Records. This Assumption Enables Accounting To
Quantify (Measure) Economic Events.
Lo 2, Bt: K, Difficulty: Easy, Tot: 2 Min., Aacsb: None, Aicpa Fc: Measurement, Analysis And Interpretation Ima:Reporting
Chapter 1. Accounting In Action
Chapter 2. The Recording Process
Chapter 3. Adjusting The Accounts
Chapter 4. Completing The Accounting Cycle
Chapter 5. Accounting For Merchandising Operations
Chapter 6. Inventories
Chapter 7. Fraud, Internal Control And Cash
Chapter 8. Accounting For Receivables
Chapter 9. Plant Assets, Natural Resources And Intangible Assets
Chapter 10. Liabilities
Chapter 11. Corporations: Organisations, Stock Transactions And Stockholders’ Eq
Uity
Chapter 12. Statement Of Cash Flows
Chapter 13. Financial Analysis: The Big Picture
,Chapter 1
Accounting In Action
Assignment Classification Table
Brief Exerci A
Learning Objectives Questions Ses Do It! Exercises Problems
1. 1, 2, 3, 4, 5 1 1, 2
Identify The Activities
And Users Associated
With Acco Unting.
2. Explain The Building Blocks 6, 7, 8, 9, 10 2 3, 4
Of Acco Unting: Ethics,
Principles,And As
Sumptions.
3. 11, 12, 13, 14. 1, 2, 3, 4, 5 3 5
State The 22
Accounting Eq
Uation, And Define
Itsco Mponents.
4. 15, 16, 18 6, 7, 8, 9 4 6, 7, 8 1a, 2a, 4a,
Analyze The Effects Of 5a
Busines S Transactions On
Theaccountin G Equation.
5. 17, 19, 20, 21, 10, 11 5 8, 9, 10, 11, 2a, 3a, 4a,
Describe The Four Financial 12, 13, 14, 15, 5a
Stat Ements And How They 16, 17, 18
Areprep Ared.
, ANSWERS TO QUESTIONS
1.True. Virtually Every Organization And Person In Our Society Uses Accounting Information.
Businesses, Inve Stors, Creditors, Government Agencies, And Not-For-
Profit Organizations Must Use Accounting Information To Operate Effectively.
Lo 1, Bt: K, Difficulty: Easy, Tot: 2 Min., Aacsb: None, Aicpa Fc: Reporting, Ima: Reporting
2. Accounting Is The Process Of Identifying, Recording, And Communicating The Economic Events Of An
Organ Ization To Interested Users Of The Information. The First Activity Of The Accounting Process Is
To Identify Eco Nomic Events That Are Relevant To A Particular Business. Once Identified And
Measured, The Events Are Rec Orded To Provide A History Of The Financial Activities Of The
Organization. Recording Consists Of Keeping A C Hronological Diary Of These Measured Events In
Anorderly And Systematic Manner. The Information Is Com Municated Through The Preparation And
Distribution Of Accounting Reports, The Most Common Of Whic H Are Called Financial
Statements.A Vital Element In The Communication Process Is The Accountant‟s Ability And
Responsibility To Analyze And Interpret The Reported Information.
Lo 1, Bt: K, Difficulty: Easy, Tot: 2 Min., Aacsb: None, Aicpa Fc: Reporting, Ima: Reporting
3.(A) Internal Users Are Those Who Plan, Organize, And Run The Business And Therefore Are Officers
And Other Decision Makers.
(B) To Assist Management, Accounting Provides Internal Reports. Examples Include Financial
Comparison S Of Operating Alternatives, Projections Of Income From New Sales
Campaigns,And Forecasts Of Cash Needs For The Next Year.
Lo 1, Bt: K, Difficulty: Easy, Tot: 2 Min., Aacsb: None, Aicpa Fc: Reporting, Ima: Reporting
4.
(A) Investors (Owners) Use Accounting Information To Make Decisions To Buy, Hold, Or Sell Stock.
(B) Creditors2use Accounting Information To Evaluate The Risks Of Granting Credit Or Lending Money.
Lo 1, Bt: K, Difficulty: Easy, Tot: 2 Min., Aacsb: None, Aicpa Fc: Reporting, Ima: Reporting
5.False. Bookkeeping Usually Involves Only The Recording Of Economic Events And Therefore Is Just
One Part Of The Entire Accounting Process. Accounting, On The Other Hand, Involves The Entire
Process Of Identifying
, Recording, And Communicating Economic Events.
Lo 1, Bt: C, Difficulty: Easy, Tot: 2 Min., Aacsb: None, Aicpa2 Fc: Reporting, Ima: Reporting
6. Harper Travel Agency Should Report The Land At $85,000 On Its December 31, 2022 Balance Sheet.
This Is True Not Only At The Time The Land Is Purchased, But Also Over The Time The Land Is Held. In
Determining Whi Ch Measurement Principle To Use (Historical Cost Or Fair Value) Companies Weigh
The Factual Nature Of Cost Figures Versus The Relevance Of Fair Value. In General, Companies Use
Historical Cost. Only In Situations Whe Re Assets Are Actively Traded Do Companies Apply The Fair
Value Principle.
Lo 2, Bt: C, Difficulty: Easy, Tot: 2 Min., Aacsb: None, Aicpa Fc: Measurement, Analysis And Interpretation Ima: Report
7. The Monetary Unit Assumption Requires That Only Transaction Data Capable Of Being Expressed In
Terms Of Money Be Included In The Accounting Records. This Assumption Enables Accounting To
Quantify (Measure) Economic Events.
Lo 2, Bt: K, Difficulty: Easy, Tot: 2 Min., Aacsb: None, Aicpa Fc: Measurement, Analysis And Interpretation Ima:Reporting
