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

SOLUTION MANUAL FOR
Financial Accounting 11th Edition
by Robert Libby, All Chapters 1 - 13

,TABLE OF CONTENTS
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CHAPTER 1: Financial Statements and Business Decisions
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Focus Company: Le-Nature’s Inc.
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CHAPTER 2: Investing and Financing Decisions and the Accounting System
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Focus Company: Chipotle Mexican Grill
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CHAPTER 3: Operating Decisions and the Accounting System
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Focus Company: Chipotle Mexican Grill
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CHAPTER 4: Adjustments, Financial Statements, and the Closing Process
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Focus Company: Chipotle Mexican Grill
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CHAPTER 5: Communicating and Analyzing Accounting Information
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Focus Company: Apple Inc.
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CHAPTER 6: Reporting and Interpreting Sales Revenue, Receivables, and Cash
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Focus Company: Skechers U.S.A.
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CHAPTER 7: Reporting and Interpreting Cost of Goods Sold and Inventory
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Focus Company: Harley-Davidson, Inc.
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CHAPTER 8: Reporting and Interpreting Property, Plant, and Equipment; Intangibles; and Natural R
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esources
Focus Company: FedEx Corporation
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CHAPTER 9: Reporting and Interpreting Liabilities
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Focus Company: Starbucks
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CHAPTER 10: Reporting and Interpreting Bond Securities
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Focus Company: Amazon
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CHAPTER 11: Reporting and Interpreting Stockholders’ Equity
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Focus Company: Microsoft
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CHAPTER 12: Statement of Cash Flows
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Focus Company: National Beverage Corporation
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CHAPTER 13: Analyzing Financial Statements
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Focus Company: The Home Depot
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,Chapter 1 jx




Financial Statements and Business Decisions jx jx jx jx




ANSWERS TO QUESTIONS jx jx




1. Accounting is a system that collects and processes (analyzes, measures, and records)
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financial information about an organization and reports that information todecision m
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akers.


2. Financial accounting involves preparation of the four basic financial statements andrel
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ated disclosures for external decision makers. Managerial accounting involves the pre
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paration of detailed plans, budgets, forecasts, and performance reports for internal dec
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ision makers. jx




3. Financial reports are used by both internal and external groups and individuals. Theinte
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rnal groups are comprised of the various managers of the entity. The external groups in
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clude the owners, investors, creditors, governmental agencies, other interested parties,
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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 what
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the company earns and/or selling their ownership interest in the company in the futur
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e at a higher price than they paid. Creditors lend money to a company fora specific len
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gth of time and hope to gain by charging interest on the loan.
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, 5. In a society, each organization can be defined as a separate accounting entity. An accou
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nting entity is the organization for which financial data are to be collected. Typical acc
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ounting entities are a business, a church, a governmental unit, a university and other no
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nprofit organizations such as a hospital and a welfare organization. A business typicall
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y is defined and treated as a separate entity because the owners, creditors, investors, an
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d other interested parties need to evaluate its performance and its potential separately f
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rom other entities and from itsowners.
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6. Name of Statement jx jx Alternative Title jx




(a) Income Statement jx (a) Statement of Earnings; Statement of
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Income; Statement of Operations jx jx jx




(b) Balance Sheet jx (b) Statement of Financial Position
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(c) Cash Flow Statement jx jx (c) Statement of Cash Flows
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7. The heading of each of the four required financial statements should include thefoll
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owing:
(a) Name of the entity jx jx jx




(b) Name of the statement jx jx jx




(c) Date of the statement, or the period of time
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(d) Unit of measure jx jx




8. (a)
The purpose of the income statement is to present information about the reven
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ues, expenses, and the net income of an entity for a specified period oftime.
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(b) The purpose of the balance sheet is to report the financial position of an entityat a
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x given date, that is, to report information about the assets, liabilities and stockhol
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ders’ equity of the entity as of a specific date.
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(c) The purpose of the statement of cash flows is to present information about theflo
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w of cash into the entity (sources), the flow of cash out of the entity (uses), and th
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