2-1
© McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill
ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix
LLC.
ix
,SOLUTION MANUAL FOR ix ix
ADVANCED ACCOUNTING 15TH EDITION BY JOE BEN HOYLE, THOMAS ix ix ix ix ix ix ix ix
SCHAEFER AND TIMOTHY DOUPNIK
ix ix ix ix
CHAPTER 1-19 ix
CHAPTER 1 ix
ix THE EQUITY METHOD OF ACCOUNTING FOR INVESTMENTS
ix ix ix ix ix ix
Chapter Outline ix
I. Four methods are principally used to account for an investment in equity securities along
ix ix ix ix ix ix ix ix ix ix ix ix ix
with a fair value option.
ix ix ix ix ix
A. Fair value method: applied by an investor when only a small percentage of a
ix ix ix ix ix ix ix ix ix ix ix ix ix
company‘s voting stock is held.
ix ix ix ix ix
1. The investor recognizes income when the investee declares a dividend.
ix ix ix ix ix ix ix ix ix
2. Portfolios are reported at fair value. If fair values are unavailable, investment is ix ix ix ix ix ix ix ix ix ix ix ix
reported at cost. ix ix ix
B. Cost Method: applied to investments without a readily determinable fair value. When
ix ix ix ix ix ix ix ix ix ix ix
the fair value of an investment in equity securities is not readily determinable, and the
ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix
investment provides neither significant influence nor control, the investment may be
ix ix ix ix ix ix ix ix ix ix ix
measured at cost. The investment remains at cost unless
ix ix ix ix ix ix ix ix ix
1. A demonstrable impairment occurs for the investment, or
ix ix ix ix ix ix ix
2. An observable price change occurs for identical or similar investments of the same
ix ix ix ix ix ix ix ix ix ix ix ix
issuer. ix
The investor typically recognizes its share of investee dividends declared as dividend
ix ix ix ix ix ix ix ix ix ix ix
income.
ix
C. Consolidation: when one firm controls another (e.g., when a parent has a majority ix ix ix ix ix ix ix ix ix ix ix ix
interest in the voting stock of a subsidiary or control through variable interests, their
ix ix ix ix ix ix ix ix ix ix ix ix ix ix
financial statements are consolidated and reported for the combined entity.
ix ix ix ix ix ix ix ix ix ix
D. Equity method: applied when the investor has the ability to exercise significant
ix ix ix ix ix ix ix ix ix ix ix
influence over operating and financial policies of the investee.
ix ix ix ix ix ix ix ix ix
1. Ability to significantly influence investee is indicated by several factors including
ix ix ix ix ix ix ix ix ix ix
representation on the board of directors, participation in policy-making, etc.
ix ix ix ix ix ix ix ix ix ix
2. GAAP guidelines presume the equity method is applicable if 20 to 50 percent of the
ix ix ix ix ix ix ix ix ix ix ix ix ix ix
2-1
© McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill
ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix
LLC. ix
, outstanding voting stock of the investee is held by the investor. ix ix ix ix ix ix ix ix ix ix
Current financial reporting standards allow firms to elect to use fair value for any new
ix ix ix ix ix ix ix ix ix ix ix ix ix ix
investment in equity shares including those where the equity method would otherwise
ix ix ix ix ix ix ix ix ix ix ix ix
apply. However, the option, once taken, is irrevocable. The investor recognizes both
ix ix ix ix ix ix ix ix ix ix ix ix
investee dividends and changes in fair value over time as income.
ix ix ix ix ix ix ix ix ix ix ix
II. Accounting for an investment: the equity method
ix ix ix ix ix ix
A. The investor adjusts the investment account to reflect all changes in the equity of the
ix ix ix ix ix ix ix ix ix ix ix ix ix ix
investee company.
ix ix
B. The investor accrues investee income when it is reported in the investee‘s financial
ix ix ix ix ix ix ix ix ix ix ix ix
statements.
ix
C. Dividends declared by the investee create a reduction in the carrying amount of the
ix ix ix ix ix ix ix ix ix ix ix ix ix
Investment account. This book assumes all investee dividends are declared and paid
ix ix ix ix ix ix ix ix ix ix ix ix
in the same reporting period.
ix ix ix ix ix
III. Special accounting procedures used in the application of the equity method
ix ix ix ix ix ix ix ix ix ix
A. Reporting a change to the equity method when the ability to significantly influence an
ix ix ix ix ix ix ix ix ix ix ix ix ix
investee is achieved through a series of acquisitions.
ix ix ix ix ix ix ix ix
1. Initial purchase(s) will be accounted for by means of the fair value method (or at
ix ix ix ix ix ix ix ix ix ix ix ix ix ix
cost) until the ability to significantly influence is attained.
ix ix ix ix ix ix ix ix ix
2. When the ability to exercise significant influence occurs following a series of stock
ix ix ix ix ix ix ix ix ix ix ix ix
purchases, the investor applies the equity method prospectively. The total fair
ix ix ix ix ix ix ix ix ix ix ix
value at the date significant influence is attained is compared to the investee‘s
ix ix ix ix ix ix ix ix ix ix ix ix ix
book value to determine future excess fair value amortizations.
ix ix ix ix ix ix ix ix ix
B. Investee income from other than continuing operations
ix ix ix ix ix ix
1. The investor recognizes its share of investee reported other comprehensive
ix ix ix ix ix ix ix ix ix
income (OCI) through the investment account and the investor‘s own OCI.
ix ix ix ix ix ix ix ix ix ix ix
2. Income items such as discontinued operations that are reported separately by the
ix ix ix ix ix ix ix ix ix ix ix
investee should be shown in the same manner by the investor. The materiality of
ix ix ix ix ix ix ix ix ix ix ix ix ix ix
these other investee income elements (as it affects the investor) continues to be a
ix ix ix ix ix ix ix ix ix ix ix ix ix ix
criterion for separate disclosure.
ix ix ix ix
C. Investee losses ix
1. Losses reported by the investee create corresponding losses for the investor.
ix ix ix ix ix ix ix ix ix ix
2. A permanent decline in the fair value of an investee‘s stock should be recognized
ix ix ix ix ix ix ix ix ix ix ix ix ix
immediately by the investor as an impairment loss.
ix ix ix ix ix ix ix ix
3. Investee losses can possibly reduce the carrying value of the investment account
ix ix ix ix ix ix ix ix ix ix ix
to a zero balance. At that point, the equity method ceases to be applicable and the
ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix
fair-value method is subsequently used.
ix ix ix ix ix
D. Reporting the sale of an equity investment ix ix ix ix ix ix
1. The investor applies the equity method until the disposal date to establish a proper
ix ix ix ix ix ix ix ix ix ix ix ix ix
book value. ix ix
2. Following the sale, the equity method continues to be appropriate if enough shares ix ix ix ix ix ix ix ix ix ix ix ix
are still held to maintain the investor‘s ability to significantly influence the investee.
ix ix ix ix ix ix ix ix ix ix ix ix ix
If that ability has been lost, the fair-value method is subsequently used.
ix ix ix ix ix ix ix ix ix ix ix ix
2-24
© McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill
ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix
LLC. ix
, Solution Manual For All Chapters
ix ix ix ix
IV. Excess investment cost over book value acquired ix ix ix ix ix ix
A. The price an investor pays for equity securities often differs significantly from the
ix ix ix ix ix ix ix ix ix ix ix ix
investee‘s underlying book value primarily because the historical cost based
ix ix ix ix ix ix ix ix ix ix
accounting model does not keep track of changes in a firm‘s fair value.
ix ix ix ix ix ix ix ix ix ix ix ix ix
B. Payments made in excess of underlying book value can sometimes be identified with ix ix ix ix ix ix ix ix ix ix ix ix
specific investee accounts such as inventory or equipment.
ix ix ix ix ix ix ix ix
C. An extra acquisition price can also be assigned to anticipated benefits that are
ix ix ix ix ix ix ix ix ix ix ix ix
expected to be derived from the investment. In accounting, these amounts are
ix ix ix ix ix ix ix ix ix ix ix ix
presumed to reflect an intangible asset referred to as goodwill. Goodwill is calculated
ix ix ix ix ix ix ix ix ix ix ix ix ix
as any excess payment that is not attributable to specific identifiable assets and
ix ix ix ix ix ix ix ix ix ix ix ix ix
liabilities of the investee. Because goodwill is an indefinite-lived asset, it is not
ix ix ix ix ix ix ix ix ix ix ix ix ix
amortized. ix
V. Deferral of intra-entity gross profit in inventory ix ix ix ix ix ix
A. The investor‘s share of intra-entity profits in ending inventory are not recognized until
ix ix ix ix ix ix ix ix ix ix ix ix
the transferred goods are either consumed or until they are resold to unrelated parties.
ix ix ix ix ix ix ix ix ix ix ix ix ix ix
B. Downstream sales of inventory ix ix ix
1. ―Downstream‖ refers to transfers made by the investor to the investee. ix ix ix ix ix ix ix ix ix ix
2. Intra-entity gross profits from sales are initially deferred under the equity method ix ix ix ix ix ix ix ix ix ix ix
and then recognized as income at the time of the inventory‘s eventual disposal.
ix ix ix ix ix ix ix ix ix ix ix ix ix
3. The amount of gross profit to be deferred is the investor‘s ownership percentage
ix ix ix ix ix ix ix ix ix ix ix ix
multiplied by the markup on the merchandise remaining at the end of the year.
ix ix ix ix ix ix ix ix ix ix ix ix ix ix
C. Upstream sales of inventory ix ix ix
1. ―Upstream‖ refers to transfers made by the investee to the investor. ix ix ix ix ix ix ix ix ix ix
2. Under the equity method, the deferral process for intra-entity gross profits is ix ix ix ix ix ix ix ix ix ix ix
identical for upstream and downstream transfers. The procedures are separately
ix ix ix ix ix ix ix ix ix ix
identified in Chapter One because the handling does vary within the consolidation
ix ix ix ix ix ix ix ix ix ix ix ix
process. ix
Answers to Discussion Questions ix ix ix
The textbook includes discussion questions to stimulate student thought and discussion. These
ix ix ix ix ix ix ix ix ix ix ix
questions are also designed to allow students to consider relevant issues that might otherwise be
ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix
overlooked. Some of these questions may be addressed by the instructor in class to motivate
ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix
student discussion. Students should be encouraged to begin by defining the issue(s) in each
ix ix ix ix ix ix ix ix ix ix ix ix ix ix
case. Next, authoritative accounting literature (FASB ASC) or other relevant literature can be
ix ix ix ix ix ix ix ix ix ix ix ix ix
consulted as a preliminary step in arriving at logical actions. Frequently, the FASB Accounting
ix ix ix ix ix ix ix ix ix ix ix ix ix ix
Standards Codification will provide the necessary support.
ix ix ix ix ix ix ix
Unfortunately, in accounting, definitive resolutions to financial reporting questions are not always
ix ix ix ix ix ix ix ix ix ix ix
available. Students often seem to believe that all accounting issues have been resolved in the
ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix
past so that accounting education is only a matter of learning to apply historically prescribed
ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix
procedures. However, in actual practice, the only real answer is often the one that provides the
ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix
fairest representation of the firm‘s transactions. If an authoritative solution is not available,
ix ix ix ix ix ix ix ix ix ix ix ix ix
students should be directed to list all of the issues involved and the consequences of possible
ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix
alternative actions. The various factors presented can be weighed to produce a viable solution.
ix ix ix ix ix ix ix ix ix ix ix ix ix ix
The discussion questions are designed to help students develop research and critical thinking
ix ix ix ix ix ix ix ix ix ix ix ix
skills in addressing issues that go beyond the purely mechanical elements of accounting.
ix ix ix ix ix ix ix ix ix ix ix ix ix
2-3
© McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill
ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix
LLC. ix
© McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill
ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix
LLC.
ix
,SOLUTION MANUAL FOR ix ix
ADVANCED ACCOUNTING 15TH EDITION BY JOE BEN HOYLE, THOMAS ix ix ix ix ix ix ix ix
SCHAEFER AND TIMOTHY DOUPNIK
ix ix ix ix
CHAPTER 1-19 ix
CHAPTER 1 ix
ix THE EQUITY METHOD OF ACCOUNTING FOR INVESTMENTS
ix ix ix ix ix ix
Chapter Outline ix
I. Four methods are principally used to account for an investment in equity securities along
ix ix ix ix ix ix ix ix ix ix ix ix ix
with a fair value option.
ix ix ix ix ix
A. Fair value method: applied by an investor when only a small percentage of a
ix ix ix ix ix ix ix ix ix ix ix ix ix
company‘s voting stock is held.
ix ix ix ix ix
1. The investor recognizes income when the investee declares a dividend.
ix ix ix ix ix ix ix ix ix
2. Portfolios are reported at fair value. If fair values are unavailable, investment is ix ix ix ix ix ix ix ix ix ix ix ix
reported at cost. ix ix ix
B. Cost Method: applied to investments without a readily determinable fair value. When
ix ix ix ix ix ix ix ix ix ix ix
the fair value of an investment in equity securities is not readily determinable, and the
ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix
investment provides neither significant influence nor control, the investment may be
ix ix ix ix ix ix ix ix ix ix ix
measured at cost. The investment remains at cost unless
ix ix ix ix ix ix ix ix ix
1. A demonstrable impairment occurs for the investment, or
ix ix ix ix ix ix ix
2. An observable price change occurs for identical or similar investments of the same
ix ix ix ix ix ix ix ix ix ix ix ix
issuer. ix
The investor typically recognizes its share of investee dividends declared as dividend
ix ix ix ix ix ix ix ix ix ix ix
income.
ix
C. Consolidation: when one firm controls another (e.g., when a parent has a majority ix ix ix ix ix ix ix ix ix ix ix ix
interest in the voting stock of a subsidiary or control through variable interests, their
ix ix ix ix ix ix ix ix ix ix ix ix ix ix
financial statements are consolidated and reported for the combined entity.
ix ix ix ix ix ix ix ix ix ix
D. Equity method: applied when the investor has the ability to exercise significant
ix ix ix ix ix ix ix ix ix ix ix
influence over operating and financial policies of the investee.
ix ix ix ix ix ix ix ix ix
1. Ability to significantly influence investee is indicated by several factors including
ix ix ix ix ix ix ix ix ix ix
representation on the board of directors, participation in policy-making, etc.
ix ix ix ix ix ix ix ix ix ix
2. GAAP guidelines presume the equity method is applicable if 20 to 50 percent of the
ix ix ix ix ix ix ix ix ix ix ix ix ix ix
2-1
© McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill
ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix
LLC. ix
, outstanding voting stock of the investee is held by the investor. ix ix ix ix ix ix ix ix ix ix
Current financial reporting standards allow firms to elect to use fair value for any new
ix ix ix ix ix ix ix ix ix ix ix ix ix ix
investment in equity shares including those where the equity method would otherwise
ix ix ix ix ix ix ix ix ix ix ix ix
apply. However, the option, once taken, is irrevocable. The investor recognizes both
ix ix ix ix ix ix ix ix ix ix ix ix
investee dividends and changes in fair value over time as income.
ix ix ix ix ix ix ix ix ix ix ix
II. Accounting for an investment: the equity method
ix ix ix ix ix ix
A. The investor adjusts the investment account to reflect all changes in the equity of the
ix ix ix ix ix ix ix ix ix ix ix ix ix ix
investee company.
ix ix
B. The investor accrues investee income when it is reported in the investee‘s financial
ix ix ix ix ix ix ix ix ix ix ix ix
statements.
ix
C. Dividends declared by the investee create a reduction in the carrying amount of the
ix ix ix ix ix ix ix ix ix ix ix ix ix
Investment account. This book assumes all investee dividends are declared and paid
ix ix ix ix ix ix ix ix ix ix ix ix
in the same reporting period.
ix ix ix ix ix
III. Special accounting procedures used in the application of the equity method
ix ix ix ix ix ix ix ix ix ix
A. Reporting a change to the equity method when the ability to significantly influence an
ix ix ix ix ix ix ix ix ix ix ix ix ix
investee is achieved through a series of acquisitions.
ix ix ix ix ix ix ix ix
1. Initial purchase(s) will be accounted for by means of the fair value method (or at
ix ix ix ix ix ix ix ix ix ix ix ix ix ix
cost) until the ability to significantly influence is attained.
ix ix ix ix ix ix ix ix ix
2. When the ability to exercise significant influence occurs following a series of stock
ix ix ix ix ix ix ix ix ix ix ix ix
purchases, the investor applies the equity method prospectively. The total fair
ix ix ix ix ix ix ix ix ix ix ix
value at the date significant influence is attained is compared to the investee‘s
ix ix ix ix ix ix ix ix ix ix ix ix ix
book value to determine future excess fair value amortizations.
ix ix ix ix ix ix ix ix ix
B. Investee income from other than continuing operations
ix ix ix ix ix ix
1. The investor recognizes its share of investee reported other comprehensive
ix ix ix ix ix ix ix ix ix
income (OCI) through the investment account and the investor‘s own OCI.
ix ix ix ix ix ix ix ix ix ix ix
2. Income items such as discontinued operations that are reported separately by the
ix ix ix ix ix ix ix ix ix ix ix
investee should be shown in the same manner by the investor. The materiality of
ix ix ix ix ix ix ix ix ix ix ix ix ix ix
these other investee income elements (as it affects the investor) continues to be a
ix ix ix ix ix ix ix ix ix ix ix ix ix ix
criterion for separate disclosure.
ix ix ix ix
C. Investee losses ix
1. Losses reported by the investee create corresponding losses for the investor.
ix ix ix ix ix ix ix ix ix ix
2. A permanent decline in the fair value of an investee‘s stock should be recognized
ix ix ix ix ix ix ix ix ix ix ix ix ix
immediately by the investor as an impairment loss.
ix ix ix ix ix ix ix ix
3. Investee losses can possibly reduce the carrying value of the investment account
ix ix ix ix ix ix ix ix ix ix ix
to a zero balance. At that point, the equity method ceases to be applicable and the
ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix
fair-value method is subsequently used.
ix ix ix ix ix
D. Reporting the sale of an equity investment ix ix ix ix ix ix
1. The investor applies the equity method until the disposal date to establish a proper
ix ix ix ix ix ix ix ix ix ix ix ix ix
book value. ix ix
2. Following the sale, the equity method continues to be appropriate if enough shares ix ix ix ix ix ix ix ix ix ix ix ix
are still held to maintain the investor‘s ability to significantly influence the investee.
ix ix ix ix ix ix ix ix ix ix ix ix ix
If that ability has been lost, the fair-value method is subsequently used.
ix ix ix ix ix ix ix ix ix ix ix ix
2-24
© McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill
ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix
LLC. ix
, Solution Manual For All Chapters
ix ix ix ix
IV. Excess investment cost over book value acquired ix ix ix ix ix ix
A. The price an investor pays for equity securities often differs significantly from the
ix ix ix ix ix ix ix ix ix ix ix ix
investee‘s underlying book value primarily because the historical cost based
ix ix ix ix ix ix ix ix ix ix
accounting model does not keep track of changes in a firm‘s fair value.
ix ix ix ix ix ix ix ix ix ix ix ix ix
B. Payments made in excess of underlying book value can sometimes be identified with ix ix ix ix ix ix ix ix ix ix ix ix
specific investee accounts such as inventory or equipment.
ix ix ix ix ix ix ix ix
C. An extra acquisition price can also be assigned to anticipated benefits that are
ix ix ix ix ix ix ix ix ix ix ix ix
expected to be derived from the investment. In accounting, these amounts are
ix ix ix ix ix ix ix ix ix ix ix ix
presumed to reflect an intangible asset referred to as goodwill. Goodwill is calculated
ix ix ix ix ix ix ix ix ix ix ix ix ix
as any excess payment that is not attributable to specific identifiable assets and
ix ix ix ix ix ix ix ix ix ix ix ix ix
liabilities of the investee. Because goodwill is an indefinite-lived asset, it is not
ix ix ix ix ix ix ix ix ix ix ix ix ix
amortized. ix
V. Deferral of intra-entity gross profit in inventory ix ix ix ix ix ix
A. The investor‘s share of intra-entity profits in ending inventory are not recognized until
ix ix ix ix ix ix ix ix ix ix ix ix
the transferred goods are either consumed or until they are resold to unrelated parties.
ix ix ix ix ix ix ix ix ix ix ix ix ix ix
B. Downstream sales of inventory ix ix ix
1. ―Downstream‖ refers to transfers made by the investor to the investee. ix ix ix ix ix ix ix ix ix ix
2. Intra-entity gross profits from sales are initially deferred under the equity method ix ix ix ix ix ix ix ix ix ix ix
and then recognized as income at the time of the inventory‘s eventual disposal.
ix ix ix ix ix ix ix ix ix ix ix ix ix
3. The amount of gross profit to be deferred is the investor‘s ownership percentage
ix ix ix ix ix ix ix ix ix ix ix ix
multiplied by the markup on the merchandise remaining at the end of the year.
ix ix ix ix ix ix ix ix ix ix ix ix ix ix
C. Upstream sales of inventory ix ix ix
1. ―Upstream‖ refers to transfers made by the investee to the investor. ix ix ix ix ix ix ix ix ix ix
2. Under the equity method, the deferral process for intra-entity gross profits is ix ix ix ix ix ix ix ix ix ix ix
identical for upstream and downstream transfers. The procedures are separately
ix ix ix ix ix ix ix ix ix ix
identified in Chapter One because the handling does vary within the consolidation
ix ix ix ix ix ix ix ix ix ix ix ix
process. ix
Answers to Discussion Questions ix ix ix
The textbook includes discussion questions to stimulate student thought and discussion. These
ix ix ix ix ix ix ix ix ix ix ix
questions are also designed to allow students to consider relevant issues that might otherwise be
ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix
overlooked. Some of these questions may be addressed by the instructor in class to motivate
ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix
student discussion. Students should be encouraged to begin by defining the issue(s) in each
ix ix ix ix ix ix ix ix ix ix ix ix ix ix
case. Next, authoritative accounting literature (FASB ASC) or other relevant literature can be
ix ix ix ix ix ix ix ix ix ix ix ix ix
consulted as a preliminary step in arriving at logical actions. Frequently, the FASB Accounting
ix ix ix ix ix ix ix ix ix ix ix ix ix ix
Standards Codification will provide the necessary support.
ix ix ix ix ix ix ix
Unfortunately, in accounting, definitive resolutions to financial reporting questions are not always
ix ix ix ix ix ix ix ix ix ix ix
available. Students often seem to believe that all accounting issues have been resolved in the
ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix
past so that accounting education is only a matter of learning to apply historically prescribed
ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix
procedures. However, in actual practice, the only real answer is often the one that provides the
ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix
fairest representation of the firm‘s transactions. If an authoritative solution is not available,
ix ix ix ix ix ix ix ix ix ix ix ix ix
students should be directed to list all of the issues involved and the consequences of possible
ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix
alternative actions. The various factors presented can be weighed to produce a viable solution.
ix ix ix ix ix ix ix ix ix ix ix ix ix ix
The discussion questions are designed to help students develop research and critical thinking
ix ix ix ix ix ix ix ix ix ix ix ix
skills in addressing issues that go beyond the purely mechanical elements of accounting.
ix ix ix ix ix ix ix ix ix ix ix ix ix
2-3
© McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill
ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix ix
LLC. ix
