Financial Accounting

by Harrison, Walter T.; Horngren, Charles T.

• ISBN13: 9780130564276
• ISBN10: 0130564273
• Edition: 4th
• Format: Hardcover
• Copyright: 2000-06-01
• Publisher: Pearson College Div

Summary

Appropriate for a one-term course in financial accounting taught at the undergraduate or MBA level."It's not information until you use it to make a decision." This introductory financial accounting text relates accounting principles to real-life situations, illustrating them in a business context through the use of examples, problems, and infographics. The book's decision-making focus teaches students to apply what they have learned.

Table of Contents

1. The Financial Statements.

New Chapter Opening Vignette on The GAP Inc. New information on cash flows.

2. Processing Information.

New Chapter Opening Vignette on PepsiCo. New Section on “Effects of Transactions on the Financial Statements.” Streamlined bookkeeping section on “Using Journals and Ledgers to Trace Information.”

3. Accrual Accounting.

New section on “Cash Flows and Accrual Accounting” Based on It's Just Lunch. New section on “Deferrals and Accruals.” New diagram on the accounting cycle.

4. Internal Control and Cash.

Streamlined bank reconciliation material and a new diagram on “The Paths That Two Checks Take.” The diagram makes accounting for insufficient funds checks easier to understand.

5. Short-Term Investments and Receivables.

New Chapter Opening Vignette on Oracle Corporation. The new chapter opener shows how the New York Jets use Oracle's software to teach their linemen how to block opponents. Streamlined material on accounting for marketable securities, accounting for uncollectible receivables, and accounting for notes receivable.

6. Inventory.

New Chapter Opening Vignette on Teva Sandals. Chapter is now based on the perpetual inventory system. The periodic inventory system is in a new chapter appendix. Journal entries are moved back to Exhibit 6-13. LIFO, FIFO, average-cost computations are now simplified. New sections added on “Transition from Service Entities to Merchandisers,” “What Goes into Inventory Cost?” , “The Cost-of-Goods-Sold Model Brings All the Inventory Data Together,” “How Managers Decide the Amount of Inventory to Purchase,” and “A Complex Income Statement.”

7. Plant Assets.

Shortened and simplified “Capitalizing the Cost of Interest.” Simplified “Lump-Sum (Basket) Purchases of Assets.” Moved “Capital Expenditures vs. Revenue Expenditures” up to where it belongs—near “Measuring the Cost of a Plant Asset.” Streamlined “Changing the Useful Life of a Depreciable Asset.”

8. Current and Long-Term Liabilities.

Streamlined “Issuing Bonds Payable between Interest Dates” to remove a journal entry. Deleted sections on “Notes Payable Issued at a Discount,” “Vacation Pay Liability,” and “Off-Balance-Sheet Financing.”

9. Stockholders' Equity.

Deleted “Accounting for Stock Conversions,” “Donations Received by Corporations,” “Closing Net Income to Retained Earnings,” “Liquidation Value of Preferred Stock” (but kept “Redemption Value of Preferred Stock.” ) Shortened and Simplified “Accounting for Treasury Stock.” Streamlined “Accounting for Stock Dividends” and “Retirement of Stock.” Deleted the Stock Dividends Distributable account altogether (this reduces the number of journal entries to account for a stock dividend).

10. Long-Term Investments and International.

Shortened the sections on “Equity-Method Investments,” “Accounting for Consolidated Subsidiaries,” “Consolidation of Foreign Subsidiaries,” and “Using the Cash-Flow Statement to Interpret Financial Statements.”

11. Using the Income Statement and the Statement of Stockholders' Equity.

Deleted the section on “Using the Financial Statement Notes.” Streamlined the section on “Accounting for Income Taxes by Corporations” by deleting some journal entries.

12. The Statement of Cash Flows.

Focused more attention on the equation-approach to computing amounts for the statement of cash flows. The delivery is equation-approach first, followed by the T-account approach second.

13. Financial Statement Analysis.