FULL SOLUTION MANUAL FOR
m m m
Financial And Managerial Accounting 4th Edition by Jerry
m m m m m m m m
JWeygandt, Paul D Kimmel, Jill E Mitchel
m m m m m m m
CHAPTER 1 m
Accounting in Action m m
ASSIGNMENT CLASSIFICATION TABLE
m m
BriefmExe A
LearningmObjectives Questions rcises DomIt! Exercises Problems
1. 1,m2,m3,m4,m5 1 1,m2
Identifymthemactivitiesma
ndmusersmassociatedmwit
hmaccounting.
2.mExplainmthembuildingmblocksmofm 6,m7,m8,m9,m10 2 3,m4
accounting:methics,mprinciple
s,mandmassumptions.
3. 11,m12,m13,m14. 1,m2,m3,m4,m5 3 5
Statemthemaccountingm 22
equation,mandmdefinemit
smcomponents.
4. 15,m16,m18 6,m7,m8,m9 4 6,m7,m8 1A,m2A,m4A,
Analyzemthemeffectsmofmbusi 5A
nessmtransactionsmonmthemac
countingmequation.
5. 17,m19,m20,m21, 10,m11 5 8,m9,m10,m11, 2A,m3A,m4A,
Describemthemfourmfinancialm 12,m13,m14,m15, 5A
statementsmandmhowmtheymar 16,m17,m18
emprepared.
obtain permission to reuse this material is available at http://www.wiley.com/go/permissions.
, ©m2021mJohnmWileym&mSons,mInc.mAllmrightsmreserved.mNompartmofmthismpublicationmmaymbemreproduced,mstoredminmamretrievalmsystem,mor
mtransmitted,minmanymformmormbymanymmeans,melectronic,mmechanical,mphotocopying,mrecordingmormotherwise,mexceptm asm permittedmbymlaw.
mAdvicem onmhowmto
1-2 © 2021 John Wiley & Sons, Inc. All rights reserved. Weygandt, Financial & Managerial Accounting 4e, Solutions Manual (For Instructor Use Only)
, ANSWERS TO QUESTIONS m m
1. True.mVirtuallymeverymorganizationmandmpersonminmourmsocietymusesmaccountingminformation.mBusi
nesses,minvestors,mcreditors,mgovernmentmagencies,mandmnot-for-
profitmorganizationsmmustmusemaccountingminformationmtomoperatemeffectively.
LOm 1,m BT:m K,m Difficulty:m Easy,m TOT:m 2m min.,m AACSB:m None,m AICPAm FC:m Reporting,m IMA:m Reporting
2. Accountingmismthemprocessmofmidentifying,mrecording,mandm communicatingm themeconomicmeventsm
ofmanmorganizationmtominterestedmusersmofmtheminformation.mThemfirstmactivitymofmthemaccountingmpr
ocessmismtomidentifymeconomicmeventsmthatmaremrelevantmtomamparticularmbusiness.mOncemidentifiedm
andmmeasured,mthemeventsmaremrecordedmtomprovidemamhistorymofmthemfinancialmactivitiesmofmthemor
ganization.mRecordingmconsistsmofmkeepingmamchronologicalmdiarymofmthesemmeasuredmeventsminma
nmorderlymandmsystematicmmanner.mTheminformationmismcommunicatedmthroughmthempreparationman
dmdistributionmofmaccountingm reports,m them mostm commonm ofm whichmarem calledmfinancialmstatem
ents.mAmvitalmelementminmthemcommunicationmprocessmismthemaccountant’smabilitymandmresponsibility
mtomanalyzemandm interpretmthem reportedm information.
LOm 1,m BT:m K,m Difficulty:m Easy,m TOT:m 2m min.,m AACSB:m None,m AICPAm FC:m Reporting,m IMA:m Reporting
3. (a)mInternalmusersmaremthosemwhomplan,morganize,mandmrunmthembusinessmandmthereforemaremofficer
smandmothermdecisionmmakers.
(b) Tomassistmmanagement,maccountingmprovidesminternalmreports.mExamplesmincludemfinancialmc
omparisonsmofmoperatingmalternatives,mprojectionsmofm incomemfrommnewmsalesmcampaigns,ma
ndmforecastsmofm cashmneedsmformthemnextmyear.
LOm 1,m BT:m K,m Difficulty:m Easy,m TOT:m 2m min.,m AACSB:m None,m AICPAm FC:m Reporting,m IMA:m Reporting
4. (a) Investorsm(owners)musemaccountingminformationmtommakemdecisionsmtombuy,mhold,mormsellmstock.
(b) Creditorsmusemaccountingminformationmtomevaluatemthemrisksmofmgrantingmcreditmormlendingmmoney.
LOm 1,m BT:m K,m Difficulty:m Easy,m TOT:m 2m min.,m AACSB:m None,m AICPAm FC:m Reporting,m IMA:m Reporting
5. False.mBookkeepingmusuallyminvolvesmonlymthemrecordingmofmeconomicmeventsmandmthereforemismju
stmonempartmofmthementiremaccountingmprocess.mAccounting,monmthemothermhand,minvolvesmthementir
emprocessmofmidentifying,mrecording,mandmcommunicatingmeconomicmevents.
LOm 1,m BT:m C,m Difficulty:m Easy,m TOT:m 2m min.,m AACSB:m None,m AICPAm FC:m Reporting,m IMA:m Reporting
6. HarpermTravelmAgencymshouldmreportmthemlandmatm$85,000monmitsmDecemberm31,m 2022m balancems
heet.mThismismtruemnotmonlymatmthemtimemthemlandmismpurchased,mbutmalsomovermthemtimemthemlandmis
mheld.mInmdeterminingmwhichmmeasurementmprinciplemtomusem(historicalmcostmormfairmvalue)mcompan
iesmweighmthemfactualmnaturemofmcostmfiguresmversusmthemrelevancemofmfairmvalue.mInmgeneral,mcom
paniesmusemhistoricalmcost.mOnlyminmsituationsmwheremassetsmaremactivelymtradedmdom companiesma
pplymthemfairmvaluemprinciple.
LOm 2,m BT:m C,m Difficulty:m Easy,m TOT:m 2m min.,m AACSB:m None,m AICPAm FC:m Measurement,m Analysism andm Interpretationm IMA:m
Reporting
7. Themmonetarymunitmassumptionmrequiresmthatmonlymtransactionmdatamcapablemofmbeingmexpressedm
inmtermsmofmmoneymbemincludedminmthemaccountingmrecords.mThismassumptionmenablesmaccounting
mtomquantifym(measure)meconomicmevents.
LOm2,mBT:mK,mDifficulty:mEasy,mTOT:m2mmin.,mAACSB:mNone,mAICPAmFC:mMeasurement,mAnalysismandmInterpretationm IMA:
mReporting
obtain permission to reuse this material is available at http://www.wiley.com/go/permissions.
,
m m m
Financial And Managerial Accounting 4th Edition by Jerry
m m m m m m m m
JWeygandt, Paul D Kimmel, Jill E Mitchel
m m m m m m m
CHAPTER 1 m
Accounting in Action m m
ASSIGNMENT CLASSIFICATION TABLE
m m
BriefmExe A
LearningmObjectives Questions rcises DomIt! Exercises Problems
1. 1,m2,m3,m4,m5 1 1,m2
Identifymthemactivitiesma
ndmusersmassociatedmwit
hmaccounting.
2.mExplainmthembuildingmblocksmofm 6,m7,m8,m9,m10 2 3,m4
accounting:methics,mprinciple
s,mandmassumptions.
3. 11,m12,m13,m14. 1,m2,m3,m4,m5 3 5
Statemthemaccountingm 22
equation,mandmdefinemit
smcomponents.
4. 15,m16,m18 6,m7,m8,m9 4 6,m7,m8 1A,m2A,m4A,
Analyzemthemeffectsmofmbusi 5A
nessmtransactionsmonmthemac
countingmequation.
5. 17,m19,m20,m21, 10,m11 5 8,m9,m10,m11, 2A,m3A,m4A,
Describemthemfourmfinancialm 12,m13,m14,m15, 5A
statementsmandmhowmtheymar 16,m17,m18
emprepared.
obtain permission to reuse this material is available at http://www.wiley.com/go/permissions.
, ©m2021mJohnmWileym&mSons,mInc.mAllmrightsmreserved.mNompartmofmthismpublicationmmaymbemreproduced,mstoredminmamretrievalmsystem,mor
mtransmitted,minmanymformmormbymanymmeans,melectronic,mmechanical,mphotocopying,mrecordingmormotherwise,mexceptm asm permittedmbymlaw.
mAdvicem onmhowmto
1-2 © 2021 John Wiley & Sons, Inc. All rights reserved. Weygandt, Financial & Managerial Accounting 4e, Solutions Manual (For Instructor Use Only)
, ANSWERS TO QUESTIONS m m
1. True.mVirtuallymeverymorganizationmandmpersonminmourmsocietymusesmaccountingminformation.mBusi
nesses,minvestors,mcreditors,mgovernmentmagencies,mandmnot-for-
profitmorganizationsmmustmusemaccountingminformationmtomoperatemeffectively.
LOm 1,m BT:m K,m Difficulty:m Easy,m TOT:m 2m min.,m AACSB:m None,m AICPAm FC:m Reporting,m IMA:m Reporting
2. Accountingmismthemprocessmofmidentifying,mrecording,mandm communicatingm themeconomicmeventsm
ofmanmorganizationmtominterestedmusersmofmtheminformation.mThemfirstmactivitymofmthemaccountingmpr
ocessmismtomidentifymeconomicmeventsmthatmaremrelevantmtomamparticularmbusiness.mOncemidentifiedm
andmmeasured,mthemeventsmaremrecordedmtomprovidemamhistorymofmthemfinancialmactivitiesmofmthemor
ganization.mRecordingmconsistsmofmkeepingmamchronologicalmdiarymofmthesemmeasuredmeventsminma
nmorderlymandmsystematicmmanner.mTheminformationmismcommunicatedmthroughmthempreparationman
dmdistributionmofmaccountingm reports,m them mostm commonm ofm whichmarem calledmfinancialmstatem
ents.mAmvitalmelementminmthemcommunicationmprocessmismthemaccountant’smabilitymandmresponsibility
mtomanalyzemandm interpretmthem reportedm information.
LOm 1,m BT:m K,m Difficulty:m Easy,m TOT:m 2m min.,m AACSB:m None,m AICPAm FC:m Reporting,m IMA:m Reporting
3. (a)mInternalmusersmaremthosemwhomplan,morganize,mandmrunmthembusinessmandmthereforemaremofficer
smandmothermdecisionmmakers.
(b) Tomassistmmanagement,maccountingmprovidesminternalmreports.mExamplesmincludemfinancialmc
omparisonsmofmoperatingmalternatives,mprojectionsmofm incomemfrommnewmsalesmcampaigns,ma
ndmforecastsmofm cashmneedsmformthemnextmyear.
LOm 1,m BT:m K,m Difficulty:m Easy,m TOT:m 2m min.,m AACSB:m None,m AICPAm FC:m Reporting,m IMA:m Reporting
4. (a) Investorsm(owners)musemaccountingminformationmtommakemdecisionsmtombuy,mhold,mormsellmstock.
(b) Creditorsmusemaccountingminformationmtomevaluatemthemrisksmofmgrantingmcreditmormlendingmmoney.
LOm 1,m BT:m K,m Difficulty:m Easy,m TOT:m 2m min.,m AACSB:m None,m AICPAm FC:m Reporting,m IMA:m Reporting
5. False.mBookkeepingmusuallyminvolvesmonlymthemrecordingmofmeconomicmeventsmandmthereforemismju
stmonempartmofmthementiremaccountingmprocess.mAccounting,monmthemothermhand,minvolvesmthementir
emprocessmofmidentifying,mrecording,mandmcommunicatingmeconomicmevents.
LOm 1,m BT:m C,m Difficulty:m Easy,m TOT:m 2m min.,m AACSB:m None,m AICPAm FC:m Reporting,m IMA:m Reporting
6. HarpermTravelmAgencymshouldmreportmthemlandmatm$85,000monmitsmDecemberm31,m 2022m balancems
heet.mThismismtruemnotmonlymatmthemtimemthemlandmismpurchased,mbutmalsomovermthemtimemthemlandmis
mheld.mInmdeterminingmwhichmmeasurementmprinciplemtomusem(historicalmcostmormfairmvalue)mcompan
iesmweighmthemfactualmnaturemofmcostmfiguresmversusmthemrelevancemofmfairmvalue.mInmgeneral,mcom
paniesmusemhistoricalmcost.mOnlyminmsituationsmwheremassetsmaremactivelymtradedmdom companiesma
pplymthemfairmvaluemprinciple.
LOm 2,m BT:m C,m Difficulty:m Easy,m TOT:m 2m min.,m AACSB:m None,m AICPAm FC:m Measurement,m Analysism andm Interpretationm IMA:m
Reporting
7. Themmonetarymunitmassumptionmrequiresmthatmonlymtransactionmdatamcapablemofmbeingmexpressedm
inmtermsmofmmoneymbemincludedminmthemaccountingmrecords.mThismassumptionmenablesmaccounting
mtomquantifym(measure)meconomicmevents.
LOm2,mBT:mK,mDifficulty:mEasy,mTOT:m2mmin.,mAACSB:mNone,mAICPAmFC:mMeasurement,mAnalysismandmInterpretationm IMA:
mReporting
obtain permission to reuse this material is available at http://www.wiley.com/go/permissions.
,
