FULL SOLUTION MANUAL FOR
k k k
Financial And Managerial Accounting 4th Edition by Jerry J
k k k k k k k k k
Weygandt, Paul D Kimmel, Jill E Mitchel
k k k k k k
CHAPTER 1 k
Accounting in Action k k
ASSIGNMENT CLASSIFICATION TABLE
k k
BriefkExer A
LearningkObjectives Questions cises DokIt! Exercises Problems
1. 1,k2,k3,k4,k5 1 1,k2
Identifykthekactivitieskan
dkuserskassociatedkwithka
ccounting.
2.kExplainkthekbuildingkblockskofka 6,k7,k8,k9,k10 2 3,k4
ccounting:kethics,kprinciples,ka
ndkassumptions.
3. 11,k12,k13,k14. 1,k2,k3,k4,k5 3 5
Statekthekaccountingke 22
quation,kandkdefinekitskc
omponents.
4. 15,k16,k18 6,k7,k8,k9 4 6,k7,k8 1A,k2A,k4A,
Analyzekthekeffectskofkbusin 5A
essktransactionskonkthekacco
untingkequation.
5. 17,k19,k20,k21, 10,k11 5 8,k9,k10,k11, 2A,k3A,k4A,
Describekthekfourkfinancialkst 12,k13,k14,k15, 5A
atementskandkhowktheykarekpr 16,k17,k18
epared.
obtainkpermissionktokreusekthiskmaterialkiskavailablekatkhttp://www.wiley.com/go/permissions
.
, ©k2021kJohnkWileyk&kSons,kInc.kAllkrightskreserved.kNokpartkofkthiskpublicationkmaykbekreproduced,kstoredkinkakretrievalksystem,korktransmitte
d,kinkanykformkorkbykanykmeans,kelectronic,kmechanical,kphotocopying,krecordingkorkotherwise,kexceptkaskpermittedkbyklaw.kAdvicek onkhowkto
1-2 ©k2021kJohnkWileyk&kSons,kInc.kAllkrightskreserved.k Weygandt,kFinancialk&kManagerialkAccountingk4e,kSolutionskManualkkk (Fork InstructorkUsekO
nly)
, ANSWERS TO QUESTIONS k k
1. True.kVirtuallykeverykorganizationkandkpersonkinkourksocietykuseskaccountingkinformation.kBusiness
es,kinvestors,kcreditors,kgovernmentkagencies,kandknot-for-
profitkorganizationskmustkusekaccountingkinformationktokoperatekeffectively.
LOk 1,k BT:k K,k Difficulty:k Easy,k TOT:k 2k min.,k AACSB:k None,k AICPAk FC:k Reporting,k IMA:k Reporting
2. Accountingkiskthekprocesskofkidentifying,krecording,kandk communicatingk thekeconomickeventskofka
nkorganizationktokinterestedkuserskofkthekinformation.kThekfirstkactivitykofkthekaccountingkprocesskiskt
okidentifykeconomickeventskthatkarekrelevantktokakparticularkbusiness.kOncekidentifiedkandkmeasured
,kthekeventskarekrecordedktokprovidekakhistorykofkthekfinancialkactivitieskofkthekorganization.kRecordin
gkconsistskofkkeepingkakchronologicalkdiarykofkthesekmeasuredkeventskinkankorderlykandksystematick
manner.kThekinformationkiskcommunicatedkthroughkthekpreparationkandkdistributionkofkaccountingk r
eports,k thek mostk commonk ofk whichkarek calledkfinancialkstatements.kAkvitalkelementkinkthekcommu
nicationkprocesskiskthekaccountant’skabilitykandkresponsibilityktokanalyzekandkinterpretkthekreportedki
nformation.
LOk 1,k BT:k K,k Difficulty:k Easy,k TOT:k 2k min.,k AACSB:k None,k AICPAk FC:k Reporting,k IMA:k Reporting
3. (a)kInternalkuserskarekthosekwhokplan,korganize,kandkrunkthekbusinesskandkthereforekarekofficerskan
dkotherkdecisionkmakers.
(b) Tokassistkmanagement,kaccountingkprovideskinternalkreports.kExampleskincludekfinancialkcom
parisonskofkoperatingkalternatives,kprojectionskofk incomekfromknewksaleskcampaigns,kandkfore
castskofk cashkneedskforktheknextkyear.
LOk 1,k BT:k K,k Difficulty:k Easy,k TOT:k 2k min.,k AACSB:k None,k AICPAk FC:k Reporting,k IMA:k Reporting
4. (a) Investorsk(owners)kusekaccountingkinformationktokmakekdecisionsktokbuy,khold,korksellkstock.
(b) Creditorskusekaccountingkinformationktokevaluatekthekriskskofkgrantingkcreditkorklendingkmoney.
LOk 1,k BT:k K,k Difficulty:k Easy,k TOT:k 2k min.,k AACSB:k None,k AICPAk FC:k Reporting,k IMA:k Reporting
5. False.kBookkeepingkusuallykinvolveskonlykthekrecordingkofkeconomickeventskandkthereforekiskjustkon
ekpartkofkthekentirekaccountingkprocess.kAccounting,konkthekotherkhand,kinvolveskthekentirekprocessk
ofkidentifying,krecording,kandkcommunicatingkeconomickevents.
LOk 1,k BT:k C,k Difficulty:k Easy,k TOT:k 2k min.,k AACSB:k None,k AICPAk FC:k Reporting,k IMA:k Reporting
6. HarperkTravelkAgencykshouldkreportktheklandkatk$85,000konkitskDecemberk31,k 2022k balanceksheet.
kThiskisktrueknotkonlykatkthektimektheklandkiskpurchased,kbutkalsokoverkthektimektheklandkiskheld.kInkdet
erminingkwhichkmeasurementkprinciplektokusek(historicalkcostkorkfairkvalue)kcompanieskweighkthekfa
ctualknaturekofkcostkfigureskversuskthekrelevancekofkfairkvalue.kInkgeneral,kcompanieskusekhistoricalk
cost.kOnlykinksituationskwherekassetskarekactivelyktradedkdok companieskapplykthekfairkvaluekprincipl
e.
LOk 2,k BT:k C,k Difficulty:k Easy,k TOT:k 2k min.,k AACSB:k None,k AICPAk FC:k Measurement,k Analysisk andk Interpretationk IMA:kReporti
ng
7. Thekmonetarykunitkassumptionkrequireskthatkonlyktransactionkdatakcapablekofkbeingkexpressedkinkte
rmskofkmoneykbekincludedkinkthekaccountingkrecords.kThiskassumptionkenableskaccountingktokquant
ifyk(measure)keconomickevents.
LOk2,kBT:kK,kDifficulty:kEasy,kTOT:k2kmin.,kAACSB:kNone,kAICPAkFC:kMeasurement,kAnalysiskandkInterpretationk IMA:kReport
ing
obtainkpermissionktokreusekthiskmaterialkiskavailablekatkhttp://www.wiley.com/go/permissions
.
,
k k k
Financial And Managerial Accounting 4th Edition by Jerry J
k k k k k k k k k
Weygandt, Paul D Kimmel, Jill E Mitchel
k k k k k k
CHAPTER 1 k
Accounting in Action k k
ASSIGNMENT CLASSIFICATION TABLE
k k
BriefkExer A
LearningkObjectives Questions cises DokIt! Exercises Problems
1. 1,k2,k3,k4,k5 1 1,k2
Identifykthekactivitieskan
dkuserskassociatedkwithka
ccounting.
2.kExplainkthekbuildingkblockskofka 6,k7,k8,k9,k10 2 3,k4
ccounting:kethics,kprinciples,ka
ndkassumptions.
3. 11,k12,k13,k14. 1,k2,k3,k4,k5 3 5
Statekthekaccountingke 22
quation,kandkdefinekitskc
omponents.
4. 15,k16,k18 6,k7,k8,k9 4 6,k7,k8 1A,k2A,k4A,
Analyzekthekeffectskofkbusin 5A
essktransactionskonkthekacco
untingkequation.
5. 17,k19,k20,k21, 10,k11 5 8,k9,k10,k11, 2A,k3A,k4A,
Describekthekfourkfinancialkst 12,k13,k14,k15, 5A
atementskandkhowktheykarekpr 16,k17,k18
epared.
obtainkpermissionktokreusekthiskmaterialkiskavailablekatkhttp://www.wiley.com/go/permissions
.
, ©k2021kJohnkWileyk&kSons,kInc.kAllkrightskreserved.kNokpartkofkthiskpublicationkmaykbekreproduced,kstoredkinkakretrievalksystem,korktransmitte
d,kinkanykformkorkbykanykmeans,kelectronic,kmechanical,kphotocopying,krecordingkorkotherwise,kexceptkaskpermittedkbyklaw.kAdvicek onkhowkto
1-2 ©k2021kJohnkWileyk&kSons,kInc.kAllkrightskreserved.k Weygandt,kFinancialk&kManagerialkAccountingk4e,kSolutionskManualkkk (Fork InstructorkUsekO
nly)
, ANSWERS TO QUESTIONS k k
1. True.kVirtuallykeverykorganizationkandkpersonkinkourksocietykuseskaccountingkinformation.kBusiness
es,kinvestors,kcreditors,kgovernmentkagencies,kandknot-for-
profitkorganizationskmustkusekaccountingkinformationktokoperatekeffectively.
LOk 1,k BT:k K,k Difficulty:k Easy,k TOT:k 2k min.,k AACSB:k None,k AICPAk FC:k Reporting,k IMA:k Reporting
2. Accountingkiskthekprocesskofkidentifying,krecording,kandk communicatingk thekeconomickeventskofka
nkorganizationktokinterestedkuserskofkthekinformation.kThekfirstkactivitykofkthekaccountingkprocesskiskt
okidentifykeconomickeventskthatkarekrelevantktokakparticularkbusiness.kOncekidentifiedkandkmeasured
,kthekeventskarekrecordedktokprovidekakhistorykofkthekfinancialkactivitieskofkthekorganization.kRecordin
gkconsistskofkkeepingkakchronologicalkdiarykofkthesekmeasuredkeventskinkankorderlykandksystematick
manner.kThekinformationkiskcommunicatedkthroughkthekpreparationkandkdistributionkofkaccountingk r
eports,k thek mostk commonk ofk whichkarek calledkfinancialkstatements.kAkvitalkelementkinkthekcommu
nicationkprocesskiskthekaccountant’skabilitykandkresponsibilityktokanalyzekandkinterpretkthekreportedki
nformation.
LOk 1,k BT:k K,k Difficulty:k Easy,k TOT:k 2k min.,k AACSB:k None,k AICPAk FC:k Reporting,k IMA:k Reporting
3. (a)kInternalkuserskarekthosekwhokplan,korganize,kandkrunkthekbusinesskandkthereforekarekofficerskan
dkotherkdecisionkmakers.
(b) Tokassistkmanagement,kaccountingkprovideskinternalkreports.kExampleskincludekfinancialkcom
parisonskofkoperatingkalternatives,kprojectionskofk incomekfromknewksaleskcampaigns,kandkfore
castskofk cashkneedskforktheknextkyear.
LOk 1,k BT:k K,k Difficulty:k Easy,k TOT:k 2k min.,k AACSB:k None,k AICPAk FC:k Reporting,k IMA:k Reporting
4. (a) Investorsk(owners)kusekaccountingkinformationktokmakekdecisionsktokbuy,khold,korksellkstock.
(b) Creditorskusekaccountingkinformationktokevaluatekthekriskskofkgrantingkcreditkorklendingkmoney.
LOk 1,k BT:k K,k Difficulty:k Easy,k TOT:k 2k min.,k AACSB:k None,k AICPAk FC:k Reporting,k IMA:k Reporting
5. False.kBookkeepingkusuallykinvolveskonlykthekrecordingkofkeconomickeventskandkthereforekiskjustkon
ekpartkofkthekentirekaccountingkprocess.kAccounting,konkthekotherkhand,kinvolveskthekentirekprocessk
ofkidentifying,krecording,kandkcommunicatingkeconomickevents.
LOk 1,k BT:k C,k Difficulty:k Easy,k TOT:k 2k min.,k AACSB:k None,k AICPAk FC:k Reporting,k IMA:k Reporting
6. HarperkTravelkAgencykshouldkreportktheklandkatk$85,000konkitskDecemberk31,k 2022k balanceksheet.
kThiskisktrueknotkonlykatkthektimektheklandkiskpurchased,kbutkalsokoverkthektimektheklandkiskheld.kInkdet
erminingkwhichkmeasurementkprinciplektokusek(historicalkcostkorkfairkvalue)kcompanieskweighkthekfa
ctualknaturekofkcostkfigureskversuskthekrelevancekofkfairkvalue.kInkgeneral,kcompanieskusekhistoricalk
cost.kOnlykinksituationskwherekassetskarekactivelyktradedkdok companieskapplykthekfairkvaluekprincipl
e.
LOk 2,k BT:k C,k Difficulty:k Easy,k TOT:k 2k min.,k AACSB:k None,k AICPAk FC:k Measurement,k Analysisk andk Interpretationk IMA:kReporti
ng
7. Thekmonetarykunitkassumptionkrequireskthatkonlyktransactionkdatakcapablekofkbeingkexpressedkinkte
rmskofkmoneykbekincludedkinkthekaccountingkrecords.kThiskassumptionkenableskaccountingktokquant
ifyk(measure)keconomickevents.
LOk2,kBT:kK,kDifficulty:kEasy,kTOT:k2kmin.,kAACSB:kNone,kAICPAkFC:kMeasurement,kAnalysiskandkInterpretationk IMA:kReport
ing
obtainkpermissionktokreusekthiskmaterialkiskavailablekatkhttp://www.wiley.com/go/permissions
.
,
