Complete Solution Manual Financial Accounting Tools
for Business Decision Making 10th Edition Kimmel
Weygandt Mitchell
What is the accounting equation? - ANSWER Assets = Liability + Owners' Equity
Please explain the 3 parts of the accounting equation - ANSWER Assets = Cash,
Accounts Receivable (AR), trademarks/patents, investments
Liabilities = claims by debtors, Accounts Payable (AP)
Equity = claims by the owner
Debit is always on the _________ and Credit is always on the _________. -
ANSWER Debit is on the LEFT and credit is on the RIGHT.
Who is the "father of accounting" and in what year did he publish his book? -
ANSWER Luca Pacioli
Summa de arithmetica - 1494
Why do we need accounting? - ANSWER To discover financial inconsistencies,
fraud
Analyze and predict budgets
Compare different companies' financial reporting and performance
Define "accounting" - ANSWER A way of recording, analyzing and summarizing
transactions of a business.
What is the "language" of accounting? - ANSWER Double entry bookkeeping
What is the idea of double entry? - ANSWER The idea is that each entry is written
down twice - Debit and Credit
What are the three main steps of accounting? - ANSWER 1. Recording the
information
2. Ledgers
3. Financial statements
Cost and management accounting is concerned with providing management
information concerning what? - ANSWER 1. Planning
2. Control
3. Making decisions
What are some of the roles of Managerial Accounting? - ANSWER Cost accounting
Budgeting
Making management decisions
, Evaluating performance
Budgeting for capital costs and making decisions
Price formation
What are some of the roles of Managing Finance? - ANSWER Planning and
managing cash flows, including currency flows
Long-term financing decisions
Managing financial risks
Financing for investments
Managing working capital
What are some of aspects of preparing financial statements? - ANSWER Financial
reports
Tax reports and calculations
Providing other info. for external users
Who are the users of information of FA? - ANSWER Shareholders, investors,
banks, suppliers, credit institutions, tax collectors, company employees and other
EXTERNAL users
Who are the user of information of MA? - ANSWER Management of different levels
WITHIN the company - president, shop foreman, etc.
What regulation(s) must be followed in FA? - ANSWER Accounting is strictly
regulated by external standard such as IFRS.
What regulation(s) must be followed in MA? - ANSWER The managers themselves
decide the accounting methods.
What degree of accuracy in required in FA? - ANSWER The data must be fair and
accurate.
What degree of accuracy in required in MA? - ANSWER Approximate values are
acceptable as long as they are sufficient for management decisions.
What is the scope of accounting in FA? - ANSWER Activities of the ENTIRE
organization
What is the scope of accounting in MA? - ANSWER Whatever the manager decides
- separate segments, areas of production, subdivisions, market areas
What are the measures of accounting information in FA? - ANSWER Cost and
monetary
What are the measures of accounting information in MA? - ANSWER Cost, in kind,
labor
What is the information base in FA? - ANSWER Information about actual facts
for Business Decision Making 10th Edition Kimmel
Weygandt Mitchell
What is the accounting equation? - ANSWER Assets = Liability + Owners' Equity
Please explain the 3 parts of the accounting equation - ANSWER Assets = Cash,
Accounts Receivable (AR), trademarks/patents, investments
Liabilities = claims by debtors, Accounts Payable (AP)
Equity = claims by the owner
Debit is always on the _________ and Credit is always on the _________. -
ANSWER Debit is on the LEFT and credit is on the RIGHT.
Who is the "father of accounting" and in what year did he publish his book? -
ANSWER Luca Pacioli
Summa de arithmetica - 1494
Why do we need accounting? - ANSWER To discover financial inconsistencies,
fraud
Analyze and predict budgets
Compare different companies' financial reporting and performance
Define "accounting" - ANSWER A way of recording, analyzing and summarizing
transactions of a business.
What is the "language" of accounting? - ANSWER Double entry bookkeeping
What is the idea of double entry? - ANSWER The idea is that each entry is written
down twice - Debit and Credit
What are the three main steps of accounting? - ANSWER 1. Recording the
information
2. Ledgers
3. Financial statements
Cost and management accounting is concerned with providing management
information concerning what? - ANSWER 1. Planning
2. Control
3. Making decisions
What are some of the roles of Managerial Accounting? - ANSWER Cost accounting
Budgeting
Making management decisions
, Evaluating performance
Budgeting for capital costs and making decisions
Price formation
What are some of the roles of Managing Finance? - ANSWER Planning and
managing cash flows, including currency flows
Long-term financing decisions
Managing financial risks
Financing for investments
Managing working capital
What are some of aspects of preparing financial statements? - ANSWER Financial
reports
Tax reports and calculations
Providing other info. for external users
Who are the users of information of FA? - ANSWER Shareholders, investors,
banks, suppliers, credit institutions, tax collectors, company employees and other
EXTERNAL users
Who are the user of information of MA? - ANSWER Management of different levels
WITHIN the company - president, shop foreman, etc.
What regulation(s) must be followed in FA? - ANSWER Accounting is strictly
regulated by external standard such as IFRS.
What regulation(s) must be followed in MA? - ANSWER The managers themselves
decide the accounting methods.
What degree of accuracy in required in FA? - ANSWER The data must be fair and
accurate.
What degree of accuracy in required in MA? - ANSWER Approximate values are
acceptable as long as they are sufficient for management decisions.
What is the scope of accounting in FA? - ANSWER Activities of the ENTIRE
organization
What is the scope of accounting in MA? - ANSWER Whatever the manager decides
- separate segments, areas of production, subdivisions, market areas
What are the measures of accounting information in FA? - ANSWER Cost and
monetary
What are the measures of accounting information in MA? - ANSWER Cost, in kind,
labor
What is the information base in FA? - ANSWER Information about actual facts
