Solution Manual for Financial Accounting 11th Edition Robert Libby, Patricia Libby, Complete Chapters 1 - 13, Verified Newest Version

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Financial Accounting 11th Edition
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Robert Libby, Patricia Libby, Frank Hodge
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Financial Accounting 11th Edition Robert Libby, b b b b b




Patricia Libby, Frank Hodge
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Chapter 1 b




Financial Statements and Business Decisions b b b b




ANSWERS TO QUESTIONS b b




1. Accounting is a system that collects and processes (analyzes, measures, and
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records) financial information about an organization and reports that information to
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decision makers.
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2. Financial accounting involves preparation of the four basic financial statements and
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related disclosures for external decision makers. Managerial accounting involves
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the preparation of detailed plans, budgets, forecasts, and performance reports for
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internal decision makers.
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3. Financial reports are used by both internal and external groups and individuals. The
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internal groups are comprised of the various managers of the entity. The external
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groups include the owners, investors, creditors, governmental agencies, other
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interested parties, and the public at large.
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4. Investors purchase all or part of a business and hope to gain by receiving part of
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what the company earns and/or selling their ownership interest in the company
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in the future at a higher price than they paid. Creditors lend money to a company
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for a specific length of time and hope to gain by charging interest on the loan.
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