Financial Accounting, Global Edition

Series
Pearson
Author
Robert Kemp / Jeffrey Waybright  
Publisher
Pearson
Cover
Softcover
Edition
3
Language
English
Total pages
768
Pub.-date
May 2014
ISBN13
9781292019543
ISBN
1292019549
Related Titles


Product detail

Product Price CHF Available  
9781292019543
Financial Accounting, Global Edition
74.20 approx. 7-9 days

eBook

You'll find the eBook here.:

Free evaluation copy for lecturers


Description

Understanding financial accounting as the language of business.

 

Once students see that accounting is the language of business, they are on their way to academic and professional success. Financial Accounting, Third Edition translates the essentials of accounting to students so they understand why and when financially sound decisions are made in business today.

 

Teaching and Learning Experience

 

This program presents a better teaching and learning experience–for you and your students. With Financial Accounting, Third Edition you will,

 

  • Personalize learning with MyAccountingLab®: MyAccountingLab provides instructors with a rich and flexible set of course materials, along with course-management tools that make it easy to deliver all or a portion of your course online.
  • Use a text with strong pedagogy tools to create a clear learning path: Students are able to acquire, understand, and retain important information by completing exercises, learning key terms, participating in discussion questions, following critical thinking activities and more.
  • Present fundamental accounting principles by using current real-world examples: Up-to-date information prepares students for working in their field.
  • Illustrate tough concepts using visuals: The text presents the connection between accounting equations and big picture concepts by using striking visuals.

 

Please note that the product you are purchasing does not include MyAccountingLab.

 

 

MyAccountingLab

 

 

Join over 11 million students benefiting from Pearson MyLabs.

 

 

This title can be supported by MyAccountingLab, an online homework and tutorial system designed to test and build your understanding. Would you like to use the power of MyAccountingLab to accelerate your learning?  You need both an access card and a course ID to access MyAccountingLab.

 

 

These are the steps you need to take:

 

 

1.  Make sure that your lecturer is already using the system

Ask your lecturer before purchasing a MyLab product as you will need a course ID from them before you can gain access to the system.

 

2.  Check whether an access card has been included with the book at a reduced cost

If it has, it will be on the inside back cover of the book.

3. If you have a course ID but no access code, you can benefit from MyAccountingLab at a reduced price by purchasing a pack containing a copy of the book and an access code for MyAccountingLab (ISBN: 9781292019734)

 

4.  If your lecturer is using the MyLab and you would like to purchase the product....Go to www.myaccountinglab.com to buy access to this interactive study programme.

 

 

 

For educator access, contact your Pearson representative. To find out who your Pearson representative is, visit www.pearsoned.co.uk/replocator

 

 

 

Features

Use a text with strong pedagogy tools to create a clear learning path

  • Waybright has crafted a text that’s written with both clarity and purpose.
  • Question and Answer format provide detailed information. Some of the best teachable moments happen when a student asks a key question that gets straight to the heart of the discussed topic. This text mirrors that approach by providing a format with key questions in the A and B headers, followed by a clear, direct, and detailed explanation.
  • Actual Decision Model summarizes the concepts and computations throughout the material. These models show each decision and how to evaluate the health of it, so that students can readily see its value in/for a business. The models in each chapter are then summed up in the Decision Guidelines in the end-of-chapter material.
  • Accounting and You feature, found in every chapter, personalizes accounting challenges, issues, and ethical situations for students to evaluate from their own perspective.
  • Concept Checks, appearing at the end of each section, allow students to review their understanding and interpretation of the materials. By showing “what it is” and “why and when it matters” together, these checks give students a place to pause and interpret what they’ve just learned.
  • Focus on Decision Making, beginning with Chapter 1, places a tremendous emphasis on making financially sound business decisions, how much risk is involved and how to evaluate the impact of it to a company. Ethics and ratio coverage are woven throughout the text to continue this emphasis.
  • Demo Docs in every chapter consist of worked through problems, representative of the chapter material, which navigate students through the computations and concepts together in a step-by-step format for overall comprehension. Additional Demo Docs are available in the study guide and on MyAccountingLab®.
  • Decision Guidelines, summarizing the chapter's key terms, concepts, and formulas in the context of business decisions, can be found at the midpoint and end of each chapter. They reinforce how the accounting information students are learning is used to make decisions in business.
  • Progressive, expansive, and challenging end-of-chapter material help students retain the material. Waybright understands that the key to students’ accounting success is in the practice and work completed in the end-of-chapter content. With this in mind, this text presents the material so that students progress from simple calculative short exercises to a mixture of calculative/conceptual exercises and on to the more complex conceptual analysis problems and cases. This progression allows students to build confidence and achieve mastery of the material.
    • Self Checks quickly audit the students’ understanding of the chapter concepts by presenting them with a series of multiple-choice questions.
    • Discussion Questions help students make the connections between the “how” and the “why” of financial accounting information through a guided series of in-class discussion questions.
    • “A” and “B” Set of Exercises and Problems provide students and instructors with two sets of problems and exercises in the text. Three sets (“C”, “D”, and “E”) of alternative exercises and problems are available in MyAccountingLab to give students more practice opportunities.
    • The Continuing Exercise highlights the same small business from chapter to chapter, allowing students to apply their understanding of chapter concepts in a business context. As students move through the text, they complete additional steps in this comprehensive exercise. Students, again, see the big picture and learn how the topics build off one another. The Continuing Exercise can be assigned and completed within MyAccountingLab.
    • The Continuing Problem is exactly like the Continuing Exercise but slightly more comprehensive. Once again, students can apply the key accounting principles learned from several chapters, increasing the interrelationships of the principles.
  • Critical Thinking Activities help prepare students for their field. One of the best qualities a student can bring to their future career is the ability to think critically. This text cultivates this skill by including the following critical thinking activities:
    • Financial Statement Analysis
    • Ethics in Action Case
    • Team Projects
    • Know Your Business: includes a case problem that shows students the importance of cash flows for small business
    • Written Comm Activity

 

Present fundamental accounting principles by using current real-world examples

  • A perfect balance of small business perspective and corporate coverage is relatable to a broader range of students. Not every student will graduate and become part of a large corporation, which is why it’s important for students to understand how financial accounting applies in small business scenarios as well as corporate ones. This text presents a straightforward look at the way ALL businesses use accounting to ensure students are equipped with the knowledge they need.
  • The Importance of Cash feature compares and contrasts large and small businesses so that students can understand the significance of cash flows to the financial health of a company.
  • The Application in Practice feature found in the end-of-chapter material takes the importance of cash one step further by allowing students the opportunity to work case problems and see the Importance of Cash flows for small business.
  • IFRS Coverage is found throughout the text. The most important potential shift in the future of financial accounting is introduced at a basic level and focused on capturing student awareness. First presented in Chapter 1, IFRS coverage is carried throughout each chapter as needed, with an icon or footnote indicating a potential shift in reporting requirements.
  • Focus on Decision Making sections place an emphasis on making financially sound business decisions, showing students how much risk is involved and how to evaluate the impact those decisions will make on a company.

Illustrate tough concepts using visuals

  • Waybright introduces a slight twist on the visuals found in this text to effectively illustrate the connection between accounting equations and big picture concepts.
  • Instead of presenting the details of the journal entries, general ledger, and t-accounts in isolation, Financial Accounting shows these details within the context of financial statements. This approach helps students appreciate the steps involved in preparing and interpreting financial statements, which is critical to their understanding of the material and success in the course.

 



 

Table of Contents

1. Business, Accounting, and You

Business, Accounting, and You
What Is a Business, and Why Study Accounting?
The Definition of a Business
The General Concept of Value
Business Owners and Other Stakeholders
The Goal of a Business
How Does a Business Operate?
Resources Needed to Start and Operate a Business
Operating the Business
The Cost of Money
How Are Businesses Organized?
The Types of Businesses
The Legal Forms of Businesses
What Is Accounting, and What Are the Key Accounting
Principles and Concepts?
Generally Accepted Accounting Principles
International Financial Reporting Standards
The Business Entity Principle
The Reliability (Objectivity) Principle
The Cost Principle
Accounting Ethics: A Matter of Trust
What Is the Role of Accounting in a Business?
How Do You Recognize a Business Transaction?
Cash Accounting
Accrual Accounting
How Do You Measure a Business Transaction?
How Do You Record Business Transactions Using the Accounting Equation?
Transaction Analysis
Stockholders Equity
How Do You Report Business Transactions Using Financial Statements?
The Income Statement
The Statement of Retained Earnings
The Balance Sheet
The Statement of Cash Flows
Relationships Among the Financial Statements

Accounting, Business, and YouPutting It All Together
Summary
Accounting Practice
Apply Your Knowledge
Know Your Business

 

2. Analyzing and Recording Business Transactions
Business, Accounting, and You
How Are Accounts Used to Keep Business Transactions Organized?
Organizing Accounts
Assets
Liabilities
Stockholders Equity
What Is Double-Entry Accounting?
Normal Balance
How Are the General Journal and General Ledger Used to Keep Track of Business Transactions?
Transaction Analysis
Applying Transaction Analysis
Balancing the T-Accounts
How Is a Trial Balance Prepared, and What Is It Used For?
Correcting Errors
Preparation of Financial Statements
Summary
Accounting Practice
Apply Your Knowledge
Know Your Business

 

3. Adjusting and Closing Entries
Business, Accounting, and You
How Does a Company Accurately Report Its Income?
Revenue Recognition and Matching Principles
What Is the Role of Adjusting Entries, and When Are They Prepared?

Accruing Revenues
Accruing Expenses
Adjusting Deferred Revenues
Adjusting Deferred Expenses
How Are Financial Statements Prepared from an Adjusted Trial Balance?
The Adjusted Trial Balance
Preparing the Financial Statements
How Does a Company Prepare for a New Accounting Period?
Completing the Accounting Cycle
The Three Closing Entries: Revenues, Expenses, and Dividends
Post-Closing Trial Balance
Summary of the Adjusting and Closing Processes
Summary
Accounting Practice
Apply Your Knowledge
Know Your Business
Comprehensive Problem

 

4. Accounting for a Merchandising Business
Business, Accounting, and You
What Are the Relationships Among Manufacturers, Wholesalers, Retailers, and Customers?
How Do Periodic and Perpetual Inventory Systems Differ?
How Do You Account for the Purchase of Inventory?
Cash and Credit Purchases
Purchase Returns and Allowances
Purchase Discounts
How Do You Account for the Sale of Inventory?
Cash Sales
Credit Sales
Sales Returns and Allowances
Sales Returns
Sales Allowances
Sales Discounts
How Do You Account for Freight Charges and Other Selling Expenses?
Costs Related to the Receipt of Goods from Suppliers
Costs Related to Delivering Goods to Customers
Other Selling Costs
How Do You Prepare a Merchandisers Financial Statements?
The Income Statement
The Statement of Retained Earnings
The Balance Sheet

Summary
Accounting Practice
Apply Your Knowledge
Know Your Business

 

5. Inventory
Business, Accounting, and You
What Inventory Costing Methods Are Allowed?
Cost Flow Versus Physical Flow of Inventory
How Are the Four Inventory Costing Methods Applied?
Inventory Cost Flows
Specific-Identification Method
First-In, First-Out (FIFO) Method
Last-In, First-Out (LIFO) Method
Average Cost Method
Journalizing Inventory Transactions
What Effect Do the Different Costing Methods Have on Net Income?
What Else Determines How Inventory Is Valued?
How Is Inventory Reported on the Balance Sheet?
Inventory Shrinkage
How Do Inventory Errors Affect the Financial Statements?
Is It Possible to Estimate the Value of Inventory If the Inventory Is Accidentally Destroyed?
Summary
Accounting Practice
Apply Your Knowledge
Know Your Business
Comprehensive Problem

 

6. The Challenges of Accounting: Standards, Internal Control, Audits, Fraud, and Ethics
Business, Accounting, and You
What Are the Rules that Govern Accounting?
Understandable
Relevant
Reliable
Generally Accepted Accounting Principles (GAAP) in the United States
Generally Accepted Accounting Principles Around the World: IFRS
Differences Between FASB and IFRS
What Is Internal Control?
Elements of an Internal Control System
What Is Fraud, and Who Commits It?
Management Fraud

Employee Embezzlement
The Factors Usually Present When Fraud Is Committed
What Is a Certified Public Accountant (CPA)?
Audits
Audit Opinions
What Are the Legal and Ethical Responsibilities of Accountants?
The Legal Responsibilities of Accountants
Ethical Responsibilities of Accountants
Summary
Accounting Practice
Apply Your Knowledge
Know Your Business

 

7. Cash and Receivables
Business, Accounting, and You
What Are the Different Types of Sales?
Cash Sales
Credit Card Sales
Debit Card Sales
Credit/Debit Card Processing
Sales on Account
What Internal Control Procedures Should Be Used for Cash?
Internal Controls over Cash Receipts
Internal Control over Cash Payments
Purchase and Payment Process
The Bank Reconciliation
Preparing the Bank Reconciliation
Book Side of the Reconciliation
Online Banking
How Is Cash Reported on the Balance Sheet?
How Do You Account for Receivables?
Types of Receivables
Internal Control over Accounts Receivable
Accounting for Uncollectible Accounts Receivable
How Do You Account for Uncollectible Accounts?
The Direct Write-Off Method
Direct Write-Off Method: Recovery of Accounts Previously Written Off
The Allowance Method
Estimating the Amount of Uncollectible Accounts
Writing Off Uncollectible Accounts Under the Allowance Method
Allowance Method: Recovery of Accounts Previously Written Off
How Are Accounts Receivable Reported on the Balance Sheet?
How Do You Account for Notes Receivable?
Identifying the Maturity Date
Origination of Notes Receivable

Computing Interest on a Note
Accruing Interest Revenue
Summary
Accounting Practice
Apply Your Knowledge
Know Your Business
Appendix 7A
What Is a Petty Cash Fund?
Setting Up the Petty Cash Fund
Replenishing the Petty Cash Fund
Changing the Petty Cash Fund
Accounting Practice

 

8. Long-Term and Other Assets
Business, Accounting, and You
What Are the Different Types of Long-Term Assets?
How Is the Cost of a Fixed Asset Calculated?
Land and Land Improvements
Buildings
Machinery and Equipment
Furniture and Fixtures
Lump-Sum (Basket) Purchase of Assets
How Are Fixed Assets Depreciated?
Measuring Depreciation
Depreciation Methods
Comparing Depreciation Methods
Partial Year Depreciation
Changing the Useful Life of a Depreciable Asset
Using Fully Depreciated Assets
How Are Costs of Repairing Fixed Assets Recorded?
Ordinary Repairs
Extraordinary Repairs
Betterments
What Happens When a Fixed Asset Is Disposed?
How Do You Account for Intangible Assets?
Specific Intangibles
Accounting for Research and Development Costs
How Are Natural Resources Accounted For?
What Are Other Assets?
How Are Long-Term Assets Reported on the Balance Sheet?

Summary
Accounting Practice
Apply Your Knowledge
Know Your Business

 

9. Current Liabilities and Long-Term Debt
Business, Accounting, and You
What Are the Differences Among Known, Estimated, and Contingent Liabilities?
How Do You Account for Current Liabilities of a Known Amount?
Accounts Payable
Notes Payable
Sales Tax Payable
Accrued Expenses (Accrued Liabilities)
Unearned Revenues
Current Portion of Long-Term Debt
How Do You Account for Current Liabilities of an Uncertain Amount?
Estimated Warranty Liability
How Do You Account for a Contingent Liability?
How Do You Account for Long-Term Debt?
Notes Payable
Bonds Payable
Lease Liabilities
How Are Liabilities Reported on the Balance Sheet?
Summary
Accounting Practice
Apply Your Knowledge
Know Your Business
Appendix 9A: Payroll.com (Located online at www.pearsonhighered/kemp)

 

10. Corporations: Paid-In Capital and Retained Earnings
Business, Accounting, and You
How Are Corporations Organized?
What Makes Up the Stockholders Equity of a Corporation?
Stockholders Rights
Classes of Stock
Par Value, Stated Value, and No-Par Stock
How Is the Issuance of Stock Recorded?
Issuing Common Stock
Issuing Preferred Stock
How Are Cash Dividends Accounted For?
Dividend Dates
Declaring and Paying Dividends
Dividing Dividends Between Preferred and Common Shareholders
Dividends on Cumulative and Noncumulative Preferred Stock

How Are Stock Dividends and Stock Splits Accounted For?
Stock Dividends
Recording Stock Dividends
Stock Splits
Stock Dividends and Stock Splits Compared
How Is Treasury Stock Accounted For?
Treasury Stock Basics
Purchase of Treasury Stock

Sale of Treasury Stock
How Is Stockholders Equity Reported on the Balance Sheet?
Summary
Accounting Practice
Apply Your Knowledge
Know Your Business

 

11. The Statement of Cash Flows
Business, Accounting, and You
What Is the Statement of Cash Flows?
How Does a Business Create a Statement of Cash Flows?
The Logic of How the Statement of Cash Flows Is Prepared
Sources and Uses of Cash: Categorizing Changes as Operating, Investing, or Financing
Statement of Cash Flows: Two Formats
How Is the Statement of Cash Flows Prepared Using the Indirect Method?
Cash Flows from Operating Activities
Cash Flows from Investing Activities
Cash Flows from Financing Activities
Net Change in Cash and Cash Balances
Noncash Investing and Financing Activities
How Is the Statement of Cash Flows Prepared Using the Direct Method?
Cash Flows from Operating Activities
Summary
Accounting Practice
Apply Your Knowledge
Know Your Business
Comprehensive Problem

 

12. Financial Statement Analysis
Business, Accounting, and You
What Is Financial Analysis?
Step One: Understand a Businesss Model and Strategy
Step Two: Understand the Environment in Which a Business Operates

Step Three: Analyze the Content of the Financial Statements and Other Information, Making Adjustments If Desired
Step Four: Analyze the Businesss Operations
Step Five: Use the Financial Analysis to Make Decisions
What Measures Does Someone Use to Analyze the Performance of a Business?
The Techniques of Financial Analysis
Vertical Analysis
Horizontal Analysis
Trend Percentages
Question 1: Is the Business a Going Concern?
An Example: Tucker Enterprises, Inc.
Question 2: How Is the Business Earning a Net Income or Loss?
An Example: Tucker Enterprises, Inc.
Question 3: Where Is the Business Getting Its Money, and Can It Pay Its
Debt Obligations?
An Example: Tucker Enterprises, Inc.
Question 4: How Is the Business Investing Its Money, and Is It Using Its
Assets Efficiently?
An Example: Tucker Enterprises, Inc.
Question 5: Is the Business Generating Enough Net Income to Reward the
Stockholders for the Use of Their Money?
An Example: Tucker Enterprises, Inc.
How Do You Put Everything Together to Make Decisions?
Seeing the Impact of Decisions
What Are Red Flags in Financial Statement Analysis?

Summary
Accounting Practice
Apply Your Knowledge
Know Your Business

Appendix A
Columbia Sportswear Company
2012 Annual Report to Shareholders
Appendix B
Time Value of MoneyFuture and Present Value Concepts
Future Value
Future-Value Tables
Future Value of an Annuity
Present Value
Present-Value Tables
Present Value of an Annuity
Accounting Practice
Company Index
Glindex
Credits