Financial Accounting – Libby 11th Edition – Complete Solutions Manual (Chapters 1–13)

SOLUTION MANUAL FOR
A A




Financial Accounting 11th Edition
A A A A




by Robert Libby, All Chapters 1 - 13
A A A A A A A

,TABLE OF CONTENTS
A A A




CHAPTERA1:AFinancialAStatementsAandABusinessADecisions
FocusACompany:ALe-Nature’sAInc.
CHAPTERA2:AInvestingAandAFinancingADecisionsAandAtheAAccountingASystem
FocusACompany:AChipotleAMexicanAGrill
CHAPTERA3:AOperatingADecisionsAandAtheAAccountingASystem
FocusACompany:AChipotleAMexicanAGrill
CHAPTERA4:AAdjustments,AFinancialAStatements,AandAtheAClosingAProcess
FocusACompany:AChipotleAMexicanAGrill
CHAPTERA5:ACommunicatingAandAAnalyzingAAccountingAInformation
FocusACompany:AAppleAInc.
CHAPTERA6:AReportingAandAInterpretingASalesARevenue,AReceivables,AandACash
FocusACompany:ASkechersAU.S.A.
CHAPTERA7:AReportingAandAInterpretingACostAofAGoodsASoldAandAInventory
FocusACompany:AHarley-Davidson,AInc.
CHAPTERA8:AReportingAandAInterpretingAProperty,APlant,AandAEquipment;AIntangibles;AandANaturalAR
esources
FocusACompany:AFedExACorporation
CHAPTERA9:AReportingAandAInterpretingALiabilities
FocusACompany:AStarbucks
CHAPTERA10:AReportingAandAInterpretingABondASecurities
FocusACompany:AAmazon
CHAPTERA11:AReportingAandAInterpretingAStockholders’AEquity
FocusACompany:AMicrosoft
CHAPTERA12:AStatementAofACashAFlows
FocusACompany:ANationalABeverageACorporation
CHAPTERA13:AAnalyzingAFinancialAStatements
FocusACompany:ATheAHomeADepot

,Chapter 1 A




Financial Statements and Business Decisions
A A A A




ANSWERS TO QUESTIONS
A A




1. AccountingAisAaAsystemAthatAcollectsAandAprocessesA(analyzes,Ameasures,AandArec
ords)AfinancialAinformationAaboutAanAorganizationAandAreportsAthatAinformationAtoAde
cisionAmakers.

2. FinancialAaccountingAinvolvesApreparationAofAtheAfourAbasicAfinancialAstatementsAan
dArelatedAdisclosuresAforAexternalAdecisionAmakers.AManagerialAaccountingAinvolvesA
theApreparationAofAdetailedAplans,Abudgets,Aforecasts,AandAperformanceAreportsAforAi
nternalAdecisionAmakers.

3. FinancialAreportsAareAusedAbyAbothAinternalAandAexternalAgroupsAandAindividuals.ATh
eAinternalAgroupsAareAcomprisedAofAtheAvariousAmanagersAofAtheAentity.ATheAexternalA
groupsAincludeAtheAowners,Ainvestors,Acreditors,AgovernmentalAagencies,AotherAinter
estedAparties,AandAtheApublicAatAlarge.

4. InvestorsApurchaseAallAorApartAofAaAbusinessAandAhopeAtoAgainAbyAreceivingApartAofA
whatAtheAcompanyAearnsAand/orAsellingAtheirAownershipAinterestAinAtheAcompanyAinA
theAfutureAatAaAhigherApriceAthanAtheyApaid.ACreditorsAlendAmoneyAtoAaAcompanyAforA
aAspecificAlengthAofAtimeAandAhopeAtoAgainAbyAchargingAinterestAonAtheAloan.

, 5. InAaAsociety,AeachAorganizationAcanAbeAdefinedAasAaAseparateAaccountingAentity.AAnA
accountingAentityAisAtheAorganizationAforAwhichAfinancialAdataAareAtoAbeAcollected.ATy
picalAaccountingAentitiesAareAaAbusiness,AaAchurch,AaAgovernmentalAunit,AaAuniversity
AandAotherAnonprofitAorganizationsAsuchAasAaAhospitalA andAaAwelfareAorganization.AAA

businessAtypicallyAisAdefinedAandAtreatedAasAaAseparateAentityAbecauseAtheAowners,A
creditors,Ainvestors,AandAotherAinterestedApartiesAneedAtoAevaluateAitsAperformanceAa
ndAitsApotentialAseparatelyAfromAotherAentitiesAandAfromAitsAowners.

6. NameAofAStatement AlternativeATitle
(a) IncomeAStatement (a)AStatementAofAEarnings;AStatementAof
Income;AStatementAofAOperations
(b) BalanceASheet (b)AStatementAofAFinancialAPosition
(c) CashAFlowAStatement (c)A StatementAofACashAFlows

7. TheAheadingAofAeachAofAtheAfourArequiredAfinancialAstatementsAshouldAincludeAth
eAfollowing:
(a) NameAofAtheAentity
(b) NameAofAtheAstatement
(c) DateAofAtheAstatement,AorAtheAperiodAofAtime
(d) UnitAofAmeasure

8. (a)
TheApurposeAofAtheAincomeAstatementAisAtoApresentAinformationAaboutAtheAre
venues,Aexpenses,AandAtheAnetAincomeAofAanAentityAforAaAspecifiedAperiodAofAti
me.
(b) TheApurposeAofAtheAbalanceAsheetAisAtoAreportAtheAfinancialApositionAofAanAentit
yAatAaAgivenAdate,AthatAis,AtoAreportAinformationAaboutAtheAassets,AliabilitiesAandA
stockholders’AequityAofAtheAentityAasAofAaAspecificAdate.
(c) TheApurposeAofAtheAstatementAofAcashAflowsAisAtoApresentAinformationAaboutAth
eAflowAofAcashAintoAtheAentityA(sources),AtheAflowAofAcashAoutAofAtheAentityA(uses)
,AandAtheAnetAincreaseAorAdecreaseAinAcashAduringAtheAperiod.
(d) TheAstatementAofAstockholders’AequityAreportsAtheAchangesAinAeachAofAtheAco
mpany’sAstockholders’AequityAaccountsAduringAtheAaccountingAperiod,Aincludin
gAissueAandArepurchaseAofAstockAandAtheAwayAthatAnetAincomeAandAdistribution
AofAdividendsAaffectedAtheAretainedAearningsAofAtheAcompanyAduringA thatAperiod
.

9. TheAincomeAstatementAandAtheAstatementAofAcashAflowsAareAdatedA―ForAtheAYearA
EndedADecemberA31‖AbecauseAtheyAreportAtheAinflowsAandAoutflowsAofAresources
AduringAaAperiodAofAtime.AInAcontrast,AtheAbalanceAsheetAisAdatedA―AtADecemberA3

1‖AbecauseAitArepresentsAtheAresources,Aobligations,AandAstockholders’AequityAatAa
AspecificAdate.