SOLUTION MANUAL FOR
Intermediate Accounting IFRS 4th
Edition by Donald E. Kieso, Jerry
J. Weygandt, Terry D. Warfield
Chapter 1 - 24
Studocu is not sponsored or endorsed by any college or university
Downloaded by Paul Wilson ()
, SOLUTION MANUAL FOR
Intermediate Accounting IFRS 4th Edition
by Donald E. Kieso, Jerry J. Weygandt,
Terry D. Warfield
Chapter 1 - 24
Downloaded by Paul Wilson ()
,SOLUTION MANUAL FOR
Intermediate Accounting IFRS 4th Edition by Donald E. Kieso, Jerry J.
Weygandt, Terry D. Warfield Chapter 1-24
CHAPTER 1
Financial Reporting and Accounting Standards
ASSIGNMENT CLASSIFICATION TABLE
Topics Questions Concepts for
Analysis
1. Global markets and financial reporting. 1, 2, 3, 4 4
2. Objective of financial reporting. 5, 6, 7, 8, 9, 10 2, 3
3. Standard-setting organizations. 11, 12, 13, 14, 1, 2, 3, 5, 6, 8, 9,
15, 16, 17, 18 11
4. Financial reporting challenges. 19, 20, 21, 22, 3, 7, 8, 10, 11, 12
23, 24, 25
ASSIGNMENT CHARACTERISTICS TABLE
Level of Time
Item Description Difficulty (minutes)
CA1.1 IFRS and standard-setting. Simple 5–10
CA1.2 IFRS and standard-setting. Simple 5–10
CA1.3 Financial reporting and accounting standards. Simple 15–20
CA1.4 Financial accounting. Simple 15–20
CA1.5 Need for IASB. Simple 15–20
CA1.6 IASB role in standard-setting. Simple 15–20
CA1.7 Accounting numbers and the environment. Simple 10–15
CA1.8 Politicalization of IFRS. Complex 15–20
CA1.9 Models for setting IFRS. Simple 10–15
CA1.10 Economic consequences. Moderate 10–15
CA1.11 Rule-making Issues. Complex 20–25
CA1.12 Financial reporting pressures. Moderate 25–35
Downloaded by Paul Wilson ()
, ANSWERS TO QUESTIONS
1. World markets are becoming increasingly intertwined. The tremendous variety and volume of both
exported and imported goods indicates the extensive involvement in international trade. As a
result, the move towards adoption of international financial reporting standards has and will
continue in the future.
LO: 1, Bloom: K, Difficulty: Simple, Time: 3-5, AACSB: None, AICPA BB: None, AICPA FC: Reporting, AICPA PC: Communication
2. Financial accounting measures, classifies, and summarizes in report form those activities and that
information which relate to the enterprise as a whole for use by parties both internal and external
to a business enterprise. Managerial accounting also measures, classifies, and summarizes in
report form enterprise activities, but the communication is for the use of internal, managerial
parties, and relates more to subsystems of the entity. Managerial accounting is management
decision-oriented and directed more toward product line, division, and profit center reporting.
LO: 1, Bloom: K, Difficulty: Simple, Time: 3-5, AACSB: None, AICPA BB: None, AICPA FC: Reporting, AICPA PC: Communication
3. Financial statements generally refer to the four basic financial statements: statement of financial
position, statement of comprehensive income (or income statement), statement of cash flows, and
statement of changes in equity. Financial reporting is a broader concept; it includes the basic
financial statements and any other means of communicating financial and economic data to
interested external parties.
LO: 1, Bloom: K, Difficulty: Simple, Time: 3-5, AACSB: None, AICPA BB: None, AICPA FC: Reporting, AICPA PC: Communication
4. If a company‘s financial performance is measured accurately, fairly, and on a timely basis, the right
managers and companies are able to attract investment capital. To provide unreliable and
irrelevant information leads to poor capital allocation which adversely affects the securities market.
LO: 1, Bloom: K, Difficulty: Simple, Time: 3-5, AACSB: None, AICPA BB: None, AICPA FC: Reporting, AICPA PC: Communication
5. A single set of high quality accounting standards ensures adequate comparability. Investors are
u u u u u u u u u u u u u
able to make better investment decisions if they receive financial information from a U.S. company
u u u u u u u u u u u u u u u
that is comparable to an international competitor.
u u u u u u
LO: u2, uBloom: uK, uDifficulty: uSimple, u Time: u3-5, uAACSB: u None, u AICPA uBB: uNone, u AICPA uFC: u Reporting, uAICPA uPC: u Communication
6. The objective of general-purpose financial reporting is to provide financial information about the
u u u u u u u u u u u u u
reporting entity that is useful to present and potential equity investors, lenders, and other creditors
u u u u u u u u u u u u u u u
in making decisions about providing resources to the entity.
u u u u u u u u
LO: u2, uBloom: uK, uDifficulty: uSimple, uTime: u3-5, uAACSB: u None, u AICPA uBB: uNone, u AICPA uFC: u Reporting, uAICPA uPC: u Communication
7. General-purpose financial statements provide financial reporting information to a wide variety of
u u u u u u u u u u u u
users. To be cost effective in providing this information, general-purpose financial statements
u u u u u u u u u u u u
provide at the least cost the most useful information possible.
u u u u u u u u u
LO: u2, uBloom: uK, uDifficulty: uSimple, uTime: u3-5, uAACSB: u None, u AICPA uBB: uNone, u AICPA uFC: u Reporting, uAICPA uPC: u Communication
8. Shareholders, creditors, suppliers, employees, and regulators all use general-purpose financial
u u u u u u u u u u
statements. The primary user group is capital providers (shareholders and creditors).
u u u u u u u u u u
LO: u2, uBloom: uK, uDifficulty: uSimple, u Time: u3-5, uAACSB: u None, u AICPA uBB: uNone, u AICPA uFC: u Reporting, uAICPA uPC: u Communication
9. The proprietary perspective is not considered appropriate because this perspective generally does
u u u u u u u u u u u u
not reflect a realistic view of the financial reporting environment. Instead, the entity
u u u u u u u u u u u u u
perspective is adopted which is consistent with the present business environment where most
u u u u u u u u u u u u u
companies engaged in financial reporting have substance separate and distinct from their owners.
u u u u u u u u u u u u
LO: u2, uBloom: uK, uDifficulty: uSimple, uTime: u3-5, uAACSB: u None, u AICPA uBB: uNone, u AICPA uFC: u Reporting, uAICPA uPC: uCommunication
Downloaded by Paul Wilson ()
Intermediate Accounting IFRS 4th
Edition by Donald E. Kieso, Jerry
J. Weygandt, Terry D. Warfield
Chapter 1 - 24
Studocu is not sponsored or endorsed by any college or university
Downloaded by Paul Wilson ()
, SOLUTION MANUAL FOR
Intermediate Accounting IFRS 4th Edition
by Donald E. Kieso, Jerry J. Weygandt,
Terry D. Warfield
Chapter 1 - 24
Downloaded by Paul Wilson ()
,SOLUTION MANUAL FOR
Intermediate Accounting IFRS 4th Edition by Donald E. Kieso, Jerry J.
Weygandt, Terry D. Warfield Chapter 1-24
CHAPTER 1
Financial Reporting and Accounting Standards
ASSIGNMENT CLASSIFICATION TABLE
Topics Questions Concepts for
Analysis
1. Global markets and financial reporting. 1, 2, 3, 4 4
2. Objective of financial reporting. 5, 6, 7, 8, 9, 10 2, 3
3. Standard-setting organizations. 11, 12, 13, 14, 1, 2, 3, 5, 6, 8, 9,
15, 16, 17, 18 11
4. Financial reporting challenges. 19, 20, 21, 22, 3, 7, 8, 10, 11, 12
23, 24, 25
ASSIGNMENT CHARACTERISTICS TABLE
Level of Time
Item Description Difficulty (minutes)
CA1.1 IFRS and standard-setting. Simple 5–10
CA1.2 IFRS and standard-setting. Simple 5–10
CA1.3 Financial reporting and accounting standards. Simple 15–20
CA1.4 Financial accounting. Simple 15–20
CA1.5 Need for IASB. Simple 15–20
CA1.6 IASB role in standard-setting. Simple 15–20
CA1.7 Accounting numbers and the environment. Simple 10–15
CA1.8 Politicalization of IFRS. Complex 15–20
CA1.9 Models for setting IFRS. Simple 10–15
CA1.10 Economic consequences. Moderate 10–15
CA1.11 Rule-making Issues. Complex 20–25
CA1.12 Financial reporting pressures. Moderate 25–35
Downloaded by Paul Wilson ()
, ANSWERS TO QUESTIONS
1. World markets are becoming increasingly intertwined. The tremendous variety and volume of both
exported and imported goods indicates the extensive involvement in international trade. As a
result, the move towards adoption of international financial reporting standards has and will
continue in the future.
LO: 1, Bloom: K, Difficulty: Simple, Time: 3-5, AACSB: None, AICPA BB: None, AICPA FC: Reporting, AICPA PC: Communication
2. Financial accounting measures, classifies, and summarizes in report form those activities and that
information which relate to the enterprise as a whole for use by parties both internal and external
to a business enterprise. Managerial accounting also measures, classifies, and summarizes in
report form enterprise activities, but the communication is for the use of internal, managerial
parties, and relates more to subsystems of the entity. Managerial accounting is management
decision-oriented and directed more toward product line, division, and profit center reporting.
LO: 1, Bloom: K, Difficulty: Simple, Time: 3-5, AACSB: None, AICPA BB: None, AICPA FC: Reporting, AICPA PC: Communication
3. Financial statements generally refer to the four basic financial statements: statement of financial
position, statement of comprehensive income (or income statement), statement of cash flows, and
statement of changes in equity. Financial reporting is a broader concept; it includes the basic
financial statements and any other means of communicating financial and economic data to
interested external parties.
LO: 1, Bloom: K, Difficulty: Simple, Time: 3-5, AACSB: None, AICPA BB: None, AICPA FC: Reporting, AICPA PC: Communication
4. If a company‘s financial performance is measured accurately, fairly, and on a timely basis, the right
managers and companies are able to attract investment capital. To provide unreliable and
irrelevant information leads to poor capital allocation which adversely affects the securities market.
LO: 1, Bloom: K, Difficulty: Simple, Time: 3-5, AACSB: None, AICPA BB: None, AICPA FC: Reporting, AICPA PC: Communication
5. A single set of high quality accounting standards ensures adequate comparability. Investors are
u u u u u u u u u u u u u
able to make better investment decisions if they receive financial information from a U.S. company
u u u u u u u u u u u u u u u
that is comparable to an international competitor.
u u u u u u
LO: u2, uBloom: uK, uDifficulty: uSimple, u Time: u3-5, uAACSB: u None, u AICPA uBB: uNone, u AICPA uFC: u Reporting, uAICPA uPC: u Communication
6. The objective of general-purpose financial reporting is to provide financial information about the
u u u u u u u u u u u u u
reporting entity that is useful to present and potential equity investors, lenders, and other creditors
u u u u u u u u u u u u u u u
in making decisions about providing resources to the entity.
u u u u u u u u
LO: u2, uBloom: uK, uDifficulty: uSimple, uTime: u3-5, uAACSB: u None, u AICPA uBB: uNone, u AICPA uFC: u Reporting, uAICPA uPC: u Communication
7. General-purpose financial statements provide financial reporting information to a wide variety of
u u u u u u u u u u u u
users. To be cost effective in providing this information, general-purpose financial statements
u u u u u u u u u u u u
provide at the least cost the most useful information possible.
u u u u u u u u u
LO: u2, uBloom: uK, uDifficulty: uSimple, uTime: u3-5, uAACSB: u None, u AICPA uBB: uNone, u AICPA uFC: u Reporting, uAICPA uPC: u Communication
8. Shareholders, creditors, suppliers, employees, and regulators all use general-purpose financial
u u u u u u u u u u
statements. The primary user group is capital providers (shareholders and creditors).
u u u u u u u u u u
LO: u2, uBloom: uK, uDifficulty: uSimple, u Time: u3-5, uAACSB: u None, u AICPA uBB: uNone, u AICPA uFC: u Reporting, uAICPA uPC: u Communication
9. The proprietary perspective is not considered appropriate because this perspective generally does
u u u u u u u u u u u u
not reflect a realistic view of the financial reporting environment. Instead, the entity
u u u u u u u u u u u u u
perspective is adopted which is consistent with the present business environment where most
u u u u u u u u u u u u u
companies engaged in financial reporting have substance separate and distinct from their owners.
u u u u u u u u u u u u
LO: u2, uBloom: uK, uDifficulty: uSimple, uTime: u3-5, uAACSB: u None, u AICPA uBB: uNone, u AICPA uFC: u Reporting, uAICPA uPC: uCommunication
Downloaded by Paul Wilson ()
