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

SOLUTION MANUAL FOR
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Financial Accounting 11th Edition
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by Robert Libby, All Chapters 1 - 13
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,TABLE OF CONTENTS
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CHAPTER a1: aFinancial aStatements aand aBusiness aDecisions
Focus aCompany: aLe-Nature’s aInc.
CHAPTER a2: aInvesting aand aFinancing aDecisions aand athe aAccounting aSystem
Focus aCompany: aChipotle aMexican aGrill
CHAPTER a3: aOperating aDecisions aand athe aAccounting aSystem
Focus aCompany: aChipotle aMexican aGrill
CHAPTER a4: aAdjustments, aFinancial aStatements, aand athe aClosing aProcess
Focus aCompany: aChipotle aMexican aGrill
CHAPTER a5: aCommunicating aand aAnalyzing aAccounting aInformation
Focus aCompany: aApple aInc.
CHAPTER a6: aReporting aand aInterpreting aSales aRevenue, aReceivables, aand aCash
Focus aCompany: aSkechers aU.S.A.
CHAPTER a7: aReporting aand aInterpreting aCost aof aGoods aSold aand aInventory
Focus aCompany: aHarley-Davidson, aInc.
CHAPTER a8: aReporting aand aInterpreting aProperty, aPlant, aand aEquipment; aIntangibles; aand
Natural aResources
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Focus aCompany: aFedEx aCorporation
CHAPTER a9: aReporting aand aInterpreting aLiabilities
Focus aCompany: aStarbucks
CHAPTER a10: aReporting aand aInterpreting aBond aSecurities
Focus aCompany: aAmazon
CHAPTER a11: aReporting aand aInterpreting aStockholders’ aEquity
Focus aCompany: aMicrosoft
CHAPTER a12: aStatement aof aCash aFlows
Focus aCompany: aNational aBeverage aCorporation
CHAPTER a13: aAnalyzing aFinancial aStatements
Focus aCompany: aThe aHome aDepot

,Chapter 1 a




Financial Statements and Business Decisions
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ANSWERS TO QUESTIONS
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1. Accounting ais aa asystem athat acollects aand aprocesses a(analyzes, ameasures, aand
arecords) afinancial ainformation aabout aan aorganization aand areports athat

ainformation atoa
decision amakers.

2. Financial aaccounting ainvolves apreparation aof athe afour abasic afinancial astatements
aandarelated adisclosures afor aexternal adecision amakers. aManagerial aaccounting
ainvolves athe apreparation aof adetailed aplans, abudgets, aforecasts, aand

aperformance areports afor ainternal adecision amakers.




3. Financial areports aare aused aby aboth ainternal aand aexternal agroups aand aindividuals.
aTheainternal agroups aare acomprised aof athe avarious amanagers aof athe aentity. aThe
aexternal agroups ainclude athe aowners, ainvestors, acreditors, agovernmental

aagencies, aother ainterested aparties, a and athe apublic aat alarge.




4. Investors apurchase aall aor apart aof aa abusiness aand ahope ato again aby areceiving
apart aof awhat athe acompany aearns aand/or aselling a their aownership ainterest ain athe

acompany ain athe afuture aat aa ahigher aprice athan athey apaid. aCreditors alend amoney

ato aa acompany afora a aspecific alength aof atime aand ahope ato again aby acharging
ainterest aon athe aloan.

, 5. In aa asociety, aeach aorganization acan abe adefined aas aa aseparate aaccounting aentity.
aAn aaccounting aentity ais athe aorganization afor awhich afinancial a data aare ato abe

acollected. aTypical aaccounting aentities aare aa abusiness, aa achurch, aa

agovernmental a unit, aa auniversity aand aother anonprofit aorganizations asuch aas aa

ahospital a and aa awelfare aorganization. aA abusiness atypically ais adefined aand

atreated aas aa aseparate aentity abecause athe aowners, acreditors, ainvestors, aand

aother ainterested aparties aneed ato aevaluate aits aperformance aand aits apotential

aseparately afrom aother aentities aand afrom aitsa
owners.

6. Name aof aStatement Alternative aTitle
(a) Income aStatement (a) aStatement aof aEarnings; aStatement aof
Income; aStatement aof aOperations
(b) Balance aSheet (b) aStatement aof aFinancial aPosition
(c) Cash aFlow aStatement (c) a Statement aof aCash aFlows

7. The aheading aof aeach aof athe afour arequired afinancial astatements ashould
ainclude atheafollowing:
(a) Name aof athe aentity
(b) Name aof athe astatement
(c) Date aof athe astatement, aor athe aperiod aof atime
(d) Unit aof ameasure

8. (a) The apurpose aof athe aincome astatement ais ato apresent ainformation aabout
athe arevenues, aexpenses, aand athe a net aincome aof a an aentity afor aa aspecified

aperiod a ofa time.
(b) The apurpose aof athe abalance asheet ais ato areport athe afinancial aposition aof aan
aentitya at aa agiven adate, athat ais, ato areport ainformation aabout athe aassets,
a liabilities aand astockholders’ aequity a of athe a entity a as aof aa a specific adate.

(c) The apurpose aof athe astatement aof acash aflows ais ato apresent ainformation
aabout athea flow aof acash ainto athe aentity a(sources), athe aflow aof acash aout aof
athe aentity a(uses), aand athe anet aincrease aor adecrease ain acash a during a the

aperiod.

(d) The astatement aof astockholders’ aequity areports athe achanges ain aeach aof athe
acompany’s astockholders’ aequity aaccounts aduring a the aaccounting aperiod,

aincluding aissue aand arepurchase aof astock aand a the away athat anet aincome

aand adistribution aof adividends aaffected athe aretained aearnings aof athe

acompany aduringa that aperiod.

9. The aincome astatement aand athe astatement aof acash aflows aare adated a―For athe
aYear aEnded aDecember a31‖ abecause athey areport athe ainflows aand aoutflows aof

aresources aduring aa aperiod aof atime. aIn acontrast, athe abalance asheet ais adated

a―At aDecember a31‖a because ait arepresents athe aresources, aobligations, aand
astockholders’ aequity aat aa aspecific adate.