Financial Reporting and Analysis Using Financial Accounting Information

by Gibson, Charles H.

• ISBN13: 9780324023534
• ISBN10: 0324023537
• Format: Hardcover
• Copyright: 2000-05-01
• Publisher: South-Western College Pub

Summary

Involves students in actual financial statements and their analysis and interpretation to facilitate understanding and interest. Uses real information about real businesses to teach about finance. Previous edition: c1988. DLC: Financial statements

Table of Contents

Introduction to Financial Reporting	1	(36)
Development of Generally Accepted Accounting Principles (GAAP)	2	(6)
Additional Input---American Institute of Certified Public Accountants (AICPA)	8	(1)
Emerging Issues Task Force (EITF)	9	(1)
Traditional Assumptions of the Accounting Model	9	(8)
Using the Internet	17	(2)
Summary	19	(1)
Questions	19	(3)
To the Net	22	(1)
Problems	22	(15)
Standards Overload?	27	(1)
Standard Setting: ``A Political Aspect''	28	(3)
Standard Setting: ``By the Way of the United States Congress''	31	(1)
Recognizing Revenue and Related Costs---Consider These Situations (Part I)	31	(2)
Recognizing Revenue and Related Costs---Consider These Situations (Part II)	33	(1)
Cash Basis---Accrual Basis?	34	(1)
Going Concern?	34	(1)
Economics and Accounting: The Uncongenial Twins	35	(1)
I Often Paint Fakes	36	(1)
Introduction to Financial Statements and Other Financial Reporting Topics	37	(40)
Forms of Business Entities	38	(1)
The Financial Statements	38	(4)
The Accounting Cycle	42	(2)
Auditor's Report	44	(6)
Summary Annual Report	50	(1)
The Efficient Market Hypothesis	50	(1)
Ethics	50	(2)
Harmonization of International Accounting Standards	52	(2)
Consolidated Statements	54	(1)
Accounting for Business Combinations	54	(1)
Summary	55	(1)
Questions	56	(1)
To the Net	57	(1)
Problems	58	(19)
The CEO Retires	63	(2)
The Dangerous Morality of Managing Earnings	65	(6)
Frequent-Flier Awards---Tick-Tick, Tick-Tick, Tick-Tick	71	(1)
International Accounting---Harmonization in Practice	71	(1)
Materiality: In Practice	72	(1)
Who is Responsible?	73	(1)
Safe Harbor	74	(3)
Balance Sheet	77	(50)
Basic Elements Of The Balance Sheet	78	(29)
Statement of Stockholders' Equity	107	(1)
Problems in Balance Sheet Presentation	108	(1)
Summary	108	(1)
Questions	108	(2)
To the Net	110	(1)
Problems	111	(16)
Balance Sheet Review	117	(4)
Insight on Liabilities and Shareholders' Equity	121	(1)
Insight on Shareholder's Investment	122	(1)
Insight on Assets	123	(2)
Our Principal Asset Is Our People	125	(1)
Brands Are Dead?	126	(1)
Advertising---Asset?	126	(1)
Income Statement	127	(34)
Basic Elements of the Income Statement	128	(3)
Special Income Statement Items	131	(7)
Earnings Per Share	138	(1)
Retained Earnings	138	(3)
Dividends and Stock Splits	141	(1)
Legality of Distributions to Stockholders	141	(1)
Comprehensive Income	142	(3)
Summary	145	(1)
Questions	145	(1)
To the Net	146	(1)
Problems	147	(14)
Electronic Solutions	153	(1)
Convenience	153	(1)
Run	154	(1)
The Big Order	155	(1)
Celtics	156	(1)
Growth	157	(1)
Preparing For the Future	158	(3)
Basics of Analysis	161	(24)
Ratio Analysis	162	(1)
Common-Size Analysis (Vertical and Horizontal)	162	(1)
Year-to-Year Change Analysis	163	(1)
Financial Statement Variations by Type of Industry	163	(2)
Review of Descriptive Information	165	(1)
Comparisons	165	(11)
Relative Size of Firm	176	(1)
Other Library Sources	176	(3)
The Users of Financial Statements	179	(1)
Summary	180	(1)
Questions	180	(2)
To the Net	182	(1)
Problems	182	(3)
Liquidity of Short-Term Assets; Related Debt-Paying Ability	185	(52)
Current Assets, Current Liabilites, and the Operating Cycle	186	(20)
Current Assets Compared with Current Liabilities	206	(4)
Other Liquidity Considerations	210	(2)
Summary	212	(1)
Questions	213	(3)
To the Net	216	(1)
Problems	216	(21)
LIFO-FIFO	229	(1)
Rising Prices, a Time to Switch Off LIFO?	230	(1)
Online	231	(2)
The Other Side of LIFO	233	(1)
Network Supreme	234	(2)
Booming Retail	236	(1)
Long-Term Debt-Paying Ability	237	(48)
Income Statement Consideration when Determining Long-Term Debt-Paying Ability	238	(3)
Balance Sheet Consideration when Determining Long-Term Debt-Paying Ability	241	(7)
Special Items that Influence A Firm's Long-Term Debt-Paying Ability	248	(12)
Summary	260	(2)
Questions	262	(2)
To the Net	264	(1)
Problems	265	(20)
Expensing Interest Now and Later	273	(1)
Consideration of Leases	273	(3)
Lockout	276	(1)
Determine the Liability	277	(1)
Play It Safe	278	(3)
Retirement Plans Revisited	281	(1)
Fair Value of Financial Instruments	282	(3)
Profitability	285	(40)
Profitability Measures	286	(12)
Trends in Profitability	298	(1)
Segment Reporting	298	(3)
Gains and Losses from Prior Priod Adjustments	301	(1)
Comprehensive Income	302	(1)
Interim Reports	302	(1)
Summary	303	(1)
Questions	304	(1)
To the Net	305	(1)
Problems	306	(19)
Johnny's Self-Service Station	314	(1)
The Tale of the Segments	315	(2)
Insights on Geographic Area	317	(2)
Tide, Pampers, and Etc.	319	(2)
Vehicles and Housing	321	(4)
For the Investor	325	(32)
Leverage and its Effects on Earnings	326	(2)
Earnings Per Common Share	328	(2)
Price/Earnings Ratio	330	(1)
Percentage of Earnings Retained	331	(1)
Dividend Payout	331	(1)
Dividend Yield	332	(1)
Book Value Per Share	333	(1)
Stock Options	334	(2)
Stock Appreciation Rigths	336	(1)
Summary	337	(1)
Questions	338	(1)
To the Net	339	(1)
Problems	340	(17)
Stock Split	346	(2)
Why the Change?	348	(1)
Stock Split Revisited	349	(4)
Stock Option Plans	353	(1)
View This Investment	354	(3)
Statement of cash Flows	357	(54)
Basic Elements of the Statement of Cash Flows	358	(6)
Financial Ratios and the Statement of Cash Flows	364	(4)
Alternative Cash Flow	368	(1)
Procedures for Development of the Statement of Cash Flows	368	(6)
Summary	374	(1)
Questions	375	(1)
To the Net	376	(1)
Problems	377	(34)
Cash Flow Tales	392	(2)
Watch the Cash	394	(2)
Rapidly Expanding	396	(7)
The Retail Mover	403	(3)
Non-Cash Charges	406	(3)
Cash Movements and Periodic Income Determination	409	(2)
Summary Analysis Nike, Inc. (Includes 1999 Financial Statements)	411	(186)
Nike---Background Information	412	(1)
Analysis of Nike	412	(8)
Summary	420	(45)
Expanded Analysis	465	(42)
Financial Ratios as Perceived by Commercial Loan Departments	466	(2)
Financial Ratios as Perceived by Corporate Controllers	468	(2)
Financial Ratios as Perceived by Certified Public Accountants	470	(1)
Financial Ratios as Perceived by Chartered Financial Analysts	470	(1)
Financial Ratios Used in Annual Reports	471	(2)
Degree of Conservatism and Quality of Earnings	473	(1)
Forecasting Financial Failure	474	(3)
Analytical Review Procedures	477	(1)
Management's use of Analysis	477	(1)
Use of LIFO Reserves	478	(1)
Graphing Financial Information	479	(3)
Summary	482	(1)
Questions	482	(2)
To the Net	484	(1)
Problems	485	(22)
What Position?	502	(5)
Special Industries: Banks, Utilities, Oil and Gas, Transportation, Insurance, Real Estate Companies	507	(50)
Banks	508	(7)
Electric Utilities	515	(6)
Oil and Gas	521	(3)
Transportation	524	(5)
Insurance	529	(5)
Real Estate Companies	534	(1)
Summary	535	(1)
Questions	536	(2)
To the Net	538	(1)
Problems	539	(18)
Allowance for Funds	543	(3)
In Progress	546	(3)
Loans and Provision for Loans	549	(1)
You Can Bank of It	550	(3)
Proved Reserves	553	(2)
Heavenly Flying	555	(2)
Personal Financial Statements and Accounting for Governments and Not-for-Profit Organizations	557	(40)
Personal Financial Statements	558	(6)
Accounting for Governments	564	(4)
Accounting for Not-for-Profit Organizations Other Than Governments	568	(9)
Summary	577	(2)
Questions	579	(2)
To the Net	581	(1)
Problems	581	(16)
Governor Lucas---This is Your County	586	(11)
Glossary	597	(24)
Bibliography	621
Index	629