TESTBANKS BY TESTBANKSNERD
Solution Manual for Financial Accounting 11th Edition
by Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
All Chapters |Expert Verified Answers | Graded A+
, Chapter 1 Accounting In Action
ASSIGNMENT CLASSIFICATION TABLE
Brief A
Learning Objectives Questions Exercises Do It! Exercises Problems
1. Identify the activities and 1, 2, 3, 4, 5 1 1, 2
users associated with
accounting.
2. Explain the building blocks of 6, 7, 8, 9, 10 2 3, 4
accounting: ethics, principles,
and assumptions.
3. State the accounting 11, 12, 13, 14. 1, 2, 3, 4, 5 3 5
equation, and define its 22
components.
4. Analyze the effects of 15, 16, 18 6, 7, 8, 9 4 6, 7, 8 1A, 2A, 4A,
business transactions on the 5A
accounting equation.
5. Describe the four financial 17, 19, 20, 21, 10, 11 5 8, 9, 10, 11, 2A, 3A, 4A,
statements and how they are 12, 13, 14, 15, 5A
prepared. 16, 17, 18
1-2
, TESTBANKS BY TESTBANKSNERD
ANSWERS TO QUESTIONS
1. True. Virtually every organization and person in our society uses accounting information. Businesses,
investors, 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
organization to interested users of the information. The first activity of the accounting process is to
identify economic events that are relevant to a particular business. Once identified and measured,
the events are recorded to provide a history of the financial activities of the organization. Recording
consists of keeping a chronological diary of these measured events in an orderly and systematic
manner. The information is communicated through the preparation and distribution of accounting
reports, the most common of which 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
comparisons 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) Creditors use 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, AICPA 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 which 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 where 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:
Reporting
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
,
Solution Manual for Financial Accounting 11th Edition
by Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
All Chapters |Expert Verified Answers | Graded A+
, Chapter 1 Accounting In Action
ASSIGNMENT CLASSIFICATION TABLE
Brief A
Learning Objectives Questions Exercises Do It! Exercises Problems
1. Identify the activities and 1, 2, 3, 4, 5 1 1, 2
users associated with
accounting.
2. Explain the building blocks of 6, 7, 8, 9, 10 2 3, 4
accounting: ethics, principles,
and assumptions.
3. State the accounting 11, 12, 13, 14. 1, 2, 3, 4, 5 3 5
equation, and define its 22
components.
4. Analyze the effects of 15, 16, 18 6, 7, 8, 9 4 6, 7, 8 1A, 2A, 4A,
business transactions on the 5A
accounting equation.
5. Describe the four financial 17, 19, 20, 21, 10, 11 5 8, 9, 10, 11, 2A, 3A, 4A,
statements and how they are 12, 13, 14, 15, 5A
prepared. 16, 17, 18
1-2
, TESTBANKS BY TESTBANKSNERD
ANSWERS TO QUESTIONS
1. True. Virtually every organization and person in our society uses accounting information. Businesses,
investors, 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
organization to interested users of the information. The first activity of the accounting process is to
identify economic events that are relevant to a particular business. Once identified and measured,
the events are recorded to provide a history of the financial activities of the organization. Recording
consists of keeping a chronological diary of these measured events in an orderly and systematic
manner. The information is communicated through the preparation and distribution of accounting
reports, the most common of which 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
comparisons 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) Creditors use 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, AICPA 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 which 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 where 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:
Reporting
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
,
