BOOK
Horngren's Accounting, The Financial Chapters, Global Edition
Brenda L. Mattison | Ella Mae Matsumura | Tracie L. Miller-Nobles
(2015)
Additional Information
Book Details
Abstract
For courses in Financial and Managerial Accounting.
Expanding on Proven Success with Horngren's Accounting
Horngren’s Accounting presents the core content of the accounting course in a fresh format designed to help today’s learners succeed. The Eleventh Edition expands on the proven success of the significant revision to the Horngren franchise and uses what the authors have learned from focus groups, market feedback, and colleagues to create livelier classrooms, provide meaningful learning tools, and give professors resources to help students inside and outside the class. First, the authors ensured that content was clear, consistent, and above all, accurate. Every chapter is reviewed to ensure that students understand what they are reading and that there is consistency from chapter to chapter. The author team worked every single accounting problem and employed a team of accounting professors from across the nation to review for accuracy.
This edition continues the focus on student success and provides resources for professors to create an active and engaging classroom. Through MyAccountingLab®, students have the opportunity to watch author recorded solution videos, practice the accounting cycle using an interactive tutorial, and watch in-depth author-driven animated lectures that cover every learning objective. In addition, all instructor resources have been updated to accompany this edition of the book, including the PowerPoint presentations and Test Bank.
MyAccountingLab not included. Students, if MyAccountingLab is a recommended/mandatory component of the course, please ask your instructor for the correct ISBN and course ID. MyAccountingLab should only be purchased when required by an instructor. Instructors, contact your Pearson representative for more information.
MyAccountingLab is an online homework, tutorial, and assessment product designed to personalize learning and improve results. With a wide range of interactive, engaging, and assignable activities, students are encouraged to actively learn and retain tough course concepts.
Table of Contents
| Section Title | Page | Action | Price |
|---|---|---|---|
| Cover | Cover | ||
| Title Page | 1 | ||
| Copyright Page | 2 | ||
| About the Authors | 3 | ||
| Acknowledgments | 23 | ||
| CONTENTS | 5 | ||
| CHAPTER 1 Accounting and the Business Environment | 25 | ||
| Why Is Accounting Important? | 26 | ||
| Decision Makers: The Users of Accounting Information | 27 | ||
| The Accounting Profession | 28 | ||
| What Are the Organizations and Rules That Govern Accounting? | 30 | ||
| Governing Organizations | 30 | ||
| Generally Accepted Accounting Principles | 30 | ||
| The Economic Entity Assumption | 30 | ||
| The Cost Principle | 31 | ||
| The Going Concern Assumption | 31 | ||
| The Monetary Unit Assumption | 31 | ||
| International Financial Reporting Standards | 32 | ||
| Ethics in Accounting and Business | 32 | ||
| What Is the Accounting Equation? | 33 | ||
| Assets | 34 | ||
| Liabilities | 34 | ||
| Equity | 34 | ||
| How Do You Analyze a Transaction? | 35 | ||
| Transaction Analysis for Smart Touch Learning | 35 | ||
| How Do You Prepare Financial Statements? | 41 | ||
| Income Statement | 41 | ||
| Statement of Owner’s Equity | 42 | ||
| Balance Sheet | 43 | ||
| Statement of Cash Flows | 44 | ||
| How Do You Use Financial Statements to Evaluate Business Performance? | 46 | ||
| Green Mountain Coffee Roasters, Inc. | 46 | ||
| Return on Assets (ROA) | 46 | ||
| Review | 48 | ||
| Assess Your Progress | 53 | ||
| Critical Thinking | 75 | ||
| CHAPTER 2 Recording Business Transactions | 77 | ||
| What Is an Account? | 78 | ||
| Assets | 78 | ||
| Liabilities | 78 | ||
| Equity | 80 | ||
| Chart of Accounts | 80 | ||
| Ledger | 81 | ||
| What Is Double-Entry Accounting? | 82 | ||
| The T-Account | 82 | ||
| Increases and Decreases in the Accounts | 82 | ||
| Expanding the Rules of Debit and Credit | 83 | ||
| The Normal Balance of an Account | 83 | ||
| Determining the Balance of a T-Account | 84 | ||
| How Do You Record Transactions? | 85 | ||
| Source Documents—The Origin of the Transactions | 85 | ||
| Journalizing and Posting Transactions | 86 | ||
| The Ledger Accounts After Posting | 97 | ||
| The Four-Column Account: An Alternative to the T-Account | 99 | ||
| What Is the Trial Balance? | 101 | ||
| Preparing Financial Statements from the Trial Balance | 101 | ||
| Correcting Trial Balance Errors | 102 | ||
| How Do You Use the Debt Ratio to Evaluate Business Performance? | 103 | ||
| Review | 105 | ||
| Assess Your Progress | 112 | ||
| Critical Thinking | 137 | ||
| CHAPTER 3 The Adjusting Process | 139 | ||
| What Is the Difference Between Cash Basis Accounting and Accrual Basis Accounting? | 140 | ||
| What Concepts and Principles Apply to Accrual Basis Accounting? | 142 | ||
| The Time Period Concept | 142 | ||
| The Revenue Recognition Principle | 142 | ||
| The Matching Principle | 143 | ||
| What Are Adjusting Entries, and How Do We Record Them? | 144 | ||
| Deferred Expenses | 145 | ||
| Deferred Revenues | 151 | ||
| Accrued Expenses | 152 | ||
| Accrued Revenues | 155 | ||
| What Is the Purpose of the Adjusted Trial Balance, and How Do We Prepare It? | 160 | ||
| What Is the Impact of Adjusting Entries on the Financial Statements? | 162 | ||
| How Could a Worksheet Help in Preparing Adjusting Entries and the Adjusted Trial Balance? | 163 | ||
| APPENDIX 3A: Alternative Treatment of Recording Deferred Expenses and Deferred Revenues | 165 | ||
| What Is an Alternative Treatment of Recording Deferred Expenses and Deferred Revenues? | 165 | ||
| Deferred Expenses | 165 | ||
| Deferred Revenues | 167 | ||
| Review | 168 | ||
| Assess Your Progress | 176 | ||
| Critical Thinking | 202 | ||
| CHAPTER 4 Completing the Accounting Cycle | 205 | ||
| How Do We Prepare Financial Statements? | 206 | ||
| Relationships Among the Financial Statements | 207 | ||
| How Could a Worksheet Help in Preparing Financial Statements? | 211 | ||
| Section 5—Income Statement | 211 | ||
| Section 6—Balance Sheet | 211 | ||
| Section 7—Determine Net Income or Net Loss | 211 | ||
| What Is the Closing Process, and How Do We Close the Accounts? | 213 | ||
| Closing Temporary Accounts—Net Income for the Period | 215 | ||
| Closing Temporary Accounts—Net Loss for the Period | 217 | ||
| How Do We Prepare a Post-Closing Trial Balance? | 219 | ||
| What Is the Accounting Cycle? | 221 | ||
| How Do We Use the Current Ratio to Evaluate Business Performance? | 222 | ||
| APPENDIX 4A: Reversing Entries: An Optional Step | 224 | ||
| What Are Reversing Entries? | 224 | ||
| Accounting for Accrued Expenses | 224 | ||
| Accounting Without a Reversing Entry | 225 | ||
| Accounting With a Reversing Entry | 226 | ||
| Review | 228 | ||
| Assess Your Progress | 236 | ||
| Comprehensive Problem 1 for Chapters 1–4 | 263 | ||
| Comprehensive Problem 2 for Chapters 1–4 | 264 | ||
| Critical Thinking | 265 | ||
| CHAPTER 5 Merchandising Operations | 268 | ||
| What Are Merchandising Operations? | 269 | ||
| The Operating Cycle of a Merchandising Business | 269 | ||
| Merchandise Inventory Systems: Perpetual and Periodic Inventory Systems | 271 | ||
| How Are Purchases of Merchandise Inventory Recorded in a Perpetual Inventory System? | 272 | ||
| Purchase of Merchandise Inventory | 273 | ||
| Purchase Discounts | 274 | ||
| Purchase Returns and Allowances | 275 | ||
| Transportation Costs | 276 | ||
| Cost of Inventory Purchased | 278 | ||
| How Are Sales of Merchandise Inventory Recorded in a Perpetual Inventory System? | 279 | ||
| Sale of Merchandise Inventory | 279 | ||
| Sales Discounts | 281 | ||
| Sales Returns and Allowances | 281 | ||
| Transportation Costs—Freight Out | 283 | ||
| Net Sales Revenue and Gross Profit | 283 | ||
| What Are the Adjusting and Closing Entries for a Merchandiser? | 284 | ||
| Adjusting Merchandise Inventory Based on a Physical Count | 284 | ||
| Closing the Accounts of a Merchandiser | 285 | ||
| Worksheet for a Merchandising Business—Perpetual Inventory System | 287 | ||
| How Are a Merchandiser’s Financial Statements Prepared? | 288 | ||
| Income Statement | 288 | ||
| Statement of Owner’s Equity and the Balance Sheet | 291 | ||
| How Do We Use the Gross Profit Percentage to Evaluate Business Performance? | 291 | ||
| APPENDIX 5A: Accounting for Merchandise Inventory in a Periodic Inventory System | 293 | ||
| How Are Merchandise Inventory Transactions Recorded in a Periodic Inventory System? | 293 | ||
| Purchases of Merchandise Inventory | 293 | ||
| Sale of Merchandise Inventory | 295 | ||
| Adjusting and Closing Entries | 295 | ||
| Preparing Financial Statements | 298 | ||
| Review | 303 | ||
| Assess Your Progress | 314 | ||
| Comprehensive Problem for Chapters 1–5 | 342 | ||
| Critical Thinking | 343 | ||
| CHAPTER 6 Merchandise Inventory | 346 | ||
| What Are the Accounting Principles and Controls That Relate to Merchandise Inventory? | 347 | ||
| Accounting Principles | 347 | ||
| Control Over Merchandise Inventory | 348 | ||
| How Are Merchandise Inventory Costs Determined Under a Perpetual Inventory System? | 349 | ||
| Specific Identification Method | 351 | ||
| First-In, First-Out (FIFO) Method | 352 | ||
| Last-In, First-Out (LIFO) Method | 353 | ||
| Weighted-Average Method | 355 | ||
| How Are Financial Statements Affected by Using Different Inventory Costing Methods? | 358 | ||
| Income Statement | 358 | ||
| Balance Sheet | 359 | ||
| How Is Merchandise Inventory Valued When Using the Lower-of-Cost-or-Market Rule? | 361 | ||
| Computing the Lower-of-Cost-or-Market | 361 | ||
| Recording the Adjusting Journal Entry to Adjust Merchandise Inventory | 361 | ||
| What Are the Effects of Merchandise Inventory Errors on the Financial Statements? | 363 | ||
| How Do We Use Inventory Turnover and Days’ Sales in Inventory to Evaluate Business Performance? | 365 | ||
| Inventory Turnover | 366 | ||
| Days’ Sales in Inventory | 366 | ||
| APPENDIX 6A: Merchandise Inventory Costs Under a Periodic Inventory System | 367 | ||
| How Are Merchandise Inventory Costs Determined Under a Periodic Inventory System? | 367 | ||
| First-In, First-Out (FIFO) Method | 368 | ||
| Last-In, First-Out (LIFO) Method | 369 | ||
| Weighted-Average Method | 369 | ||
| Review | 370 | ||
| Assess Your Progress | 377 | ||
| Critical Thinking | 394 | ||
| CHAPTER 7 Accounting Information Systems | 396 | ||
| What Is an Accounting Information System? | 397 | ||
| Effective Accounting Information Systems | 397 | ||
| Components of an Accounting Information System | 398 | ||
| How Are Sales and Cash Receipts Recorded In a Manual Accounting Information System? | 400 | ||
| Special Journals | 400 | ||
| Subsidiary Ledgers | 401 | ||
| The Sales Journal | 402 | ||
| The Cash Receipts Journal | 405 | ||
| How Are Purchases, Cash Payments, And Other Transactions Recorded In a Manual Accounting Information System? | 409 | ||
| The Purchases Journal | 409 | ||
| The Cash Payments Journal | 411 | ||
| The General Journal | 414 | ||
| How Are Transactions Recorded In a Computerized Accounting Information System? | 416 | ||
| Entry-Level Software | 416 | ||
| Enterprise Resource Planning (ERP) Systems | 416 | ||
| QuickBooks | 417 | ||
| Review | 421 | ||
| Assess Your Progress | 426 | ||
| Comprehensive Problem for Chapter 7 | 449 | ||
| Critical Thinking | 451 | ||
| CHAPTER 8 Internal Control and Cash | 454 | ||
| What Is Internal Control, and How Can It Be Used to Protect a Company’s Assets? | 455 | ||
| Internal Control and the Sarbanes-Oxley Act | 455 | ||
| The Components of Internal Control | 456 | ||
| Internal Control Procedures | 457 | ||
| The Limitations of Internal Control—Costs and Benefits | 459 | ||
| What Are the Internal Control Procedures With Respect to Cast Receipts? | 460 | ||
| Cash Receipts Over the Counter | 460 | ||
| Cash Receipts by Mail | 461 | ||
| What Are the Internal Control Procedures With Respect to Cash Payments? | 462 | ||
| Controls Over Payment by Check | 462 | ||
| How Can a Petty Cash Fund Be Used for Internal Control Purposes? | 464 | ||
| Setting Up the Petty Cash Fund | 465 | ||
| Replenishing the Petty Cash Fund | 465 | ||
| Changing the Amount of the Petty Cash Fund | 467 | ||
| How Can the Bank Account Be Used as a Control Device? | 467 | ||
| Signature Card | 468 | ||
| Deposit Ticket | 468 | ||
| Check | 468 | ||
| Bank Statement | 469 | ||
| Electronic Funds Transfers | 469 | ||
| Bank Reconciliation | 470 | ||
| Examining a Bank Reconciliation | 473 | ||
| Journalizing Transactions from the Bank Reconciliation | 474 | ||
| How Can the Cash Ratio Be Used to Evaluate Business Performance? | 475 | ||
| Review | 476 | ||
| Assess Your Progress | 484 | ||
| Critical Thinking | 501 | ||
| CHAPTER 9 Receivables | 503 | ||
| What Are Common Types of Receivables, and How Are Credit Sales Recorded? | 504 | ||
| Types of Receivables | 504 | ||
| Exercising Internal Control Over Receivables | 505 | ||
| Recording Sales on Credit | 505 | ||
| Recording Credit Card and Debit Card Sales | 506 | ||
| Factoring and Pledging Receivables | 508 | ||
| How Are Uncollectibles Accounted for When Using the Direct Write-Off Method? | 509 | ||
| Recording and Writing Off Uncollectible Accounts—Direct Write-Off Method | 509 | ||
| Recovery of Accounts Previously Written Off—Direct Write-Off Method | 509 | ||
| Limitations of the Direct Write-Off Method | 510 | ||
| How Are Uncollectibles Accounted for When Using the Allowance Method? | 511 | ||
| Recording Bad Debts Expense—Allowance Method | 511 | ||
| Writing Off Uncollectible Accounts—Allowance Method | 512 | ||
| Recovery of Accounts Previously Written Off—Allowance Method | 513 | ||
| Estimating and Recording Bad Debts Expense—Allowance Method | 513 | ||
| Comparison of Accounting for Uncollectibles | 518 | ||
| How Are Notes Receivable Accounted For? | 520 | ||
| Indentifying Maturity Date | 521 | ||
| Computing Interest on a Note | 522 | ||
| Accruing Interest Revenue and Recording Honored Notes Receivable | 522 | ||
| Recording Dishonored Notes Receivable | 524 | ||
| How Do We Use the Acid-Test Ratio, Accounts Receivable Turnover Ratio, and Days’ Sales in Receivables to Evaluate Business Performance? | 525 | ||
| Acid-Test (or Quick) Ratio | 526 | ||
| Accounts Receivable Turnover Ratio | 526 | ||
| Days’ Sales in Receivables | 527 | ||
| Review | 528 | ||
| Assess Your Progress | 534 | ||
| Critical Thinking | 552 | ||
| CHAPTER 10 Plant Assets, Natural Resources, and Intangibles | 554 | ||
| How Does a Business Measure the Cost of a Plant Asset? | 555 | ||
| Land and Land Improvements | 556 | ||
| Buildings | 557 | ||
| Machinery and Equipment | 557 | ||
| Furniture and Fixtures | 557 | ||
| Lump-Sum Purchases | 558 | ||
| Capital and Revenue Expenditures | 559 | ||
| What Is Depreciation, and How Is It Computed? | 560 | ||
| Factors in Computing Depreciation | 561 | ||
| Depreciation Methods | 561 | ||
| Partial-Year Depreciation | 567 | ||
| Changing Estimates of Depreciable Asset | 568 | ||
| Reporting Plant Assets | 569 | ||
| How Are Disposals of Plant Assets Recorded? | 570 | ||
| Discarding Plant Assets | 570 | ||
| Selling Plant Assets | 572 | ||
| How Are Natural Resources Accounted For? | 576 | ||
| How Are Intangible Assets Accounted For? | 577 | ||
| Accounting for Intangibles | 577 | ||
| Specific Intangibles | 577 | ||
| Reporting of Intangible Assets | 580 | ||
| How Do We Use the Asset Turnover Ratio to Evaluate Business Performance? | 581 | ||
| APPENDIX 10A: Exchanging Plant Assets | 582 | ||
| How Are Exchanges of Plant Assets Account For? | 582 | ||
| Exchange of Plant Assets—Gain Situation | 582 | ||
| Exchange of Plant Assets—Loss Situation | 583 | ||
| Review | 584 | ||
| Assess Your Progress | 589 | ||
| Critical Thinking | 601 | ||
| CHAPTER 11 Current Liabilities and Payroll | 603 | ||
| How Are Current Liabilities of Known Amounts Accounted For? | 604 | ||
| Accounts Payable | 604 | ||
| Sales Tax Payable | 605 | ||
| Unearned Revenues | 605 | ||
| Short-Term Notes Payable | 606 | ||
| Current Portion of Long-Term Notes Payable | 607 | ||
| How Do Companies Account for and Record Payroll? | 608 | ||
| Gross Pay and Net (Take-Home) Pay | 609 | ||
| Employee Payroll Withholding Deductions | 609 | ||
| Payroll Register | 612 | ||
| Journalizing Employee Payroll | 613 | ||
| Employer Payroll Taxes | 613 | ||
| Internal Control Over Payroll | 615 | ||
| How Are Current Liabilities That Must Be Estimated Accounted For? | 616 | ||
| Bonus Plans | 616 | ||
| Vacation, Health, and Pension Benefits | 617 | ||
| Warranties | 617 | ||
| How Are Contingent Liabilities Accounted For? | 619 | ||
| Remote Contingent Liability | 619 | ||
| Reasonably Possible Contingent Liability | 619 | ||
| Probable Contingent Liability | 619 | ||
| How Do We Use the Times-Interest-Earned Ratio to Evaluate Business Performance? | 621 | ||
| Review | 622 | ||
| Assess Your Progress | 628 | ||
| Critical Thinking | 642 | ||
| CHAPTER 12 Partnerships | 644 | ||
| What are the Characteristics and Types of Partnerships? | 645 | ||
| Partnership Characteristics | 645 | ||
| Types of Partnerships | 647 | ||
| Other Forms of Business | 648 | ||
| How are Partnerships Organized? | 649 | ||
| The Start-up of a Partnership | 650 | ||
| Partnership Financial Statements | 650 | ||
| How are Partnerships Profits and Losses Allocated? | 651 | ||
| Allocation Based on a Stated Ratio | 652 | ||
| Allocation Based on Capital Balances | 653 | ||
| Allocation Based on Services, Capital Balances, and Stated Ratios | 653 | ||
| Partner Withdrawal of Cash and Other Assets | 656 | ||
| Statement of Partners’ Equity | 657 | ||
| How Is the Admission of a Partner Accounted For? | 658 | ||
| Admission by Purchasing an Existing Partner’s Interest | 658 | ||
| Admission by Contributing to the Partnership | 659 | ||
| How Is the Withdrawal of a Partner Accounted For? | 662 | ||
| How Is the Liquidation of a Partnership Accounted For? | 664 | ||
| Sale of Assets at a Gain | 664 | ||
| Sale of Assets at a Loss with Capital Deficiency | 667 | ||
| Review | 670 | ||
| Assess Your Progress | 677 | ||
| Critical Thinking | 694 | ||
| CHAPTER 13 Corporations | 697 | ||
| What Is a Corporation? | 698 | ||
| Characteristics of Corporations | 698 | ||
| Stockholders’ Equity Basics | 699 | ||
| How Is the Issuance of Stock Accounted For? | 702 | ||
| Issuing Common Stock at Par Value | 702 | ||
| Issuing Common Stock at a Premium | 702 | ||
| Issuing No-Par Common Stock | 703 | ||
| Issuing Stated Value Common Stock | 704 | ||
| Issuing Common Stock for Assets Other Than Cash | 705 | ||
| Issuing Preferred Stock | 706 | ||
| How Is Treasury Stock Accounted For? | 707 | ||
| Treasury Stock Basics | 707 | ||
| Purchase of Treasury Stock | 707 | ||
| Sale of Treasury Stock | 707 | ||
| Retirement of Stock | 710 | ||
| How Are Dividends and Stock Splits Accounted For? | 711 | ||
| Cash Dividends | 711 | ||
| Stock Dividends | 714 | ||
| Stock Splits | 718 | ||
| Cash Dividends, Stock Dividends, and Stock Splits Compared | 718 | ||
| How Are Net Income and Equity Reported For a Corporation? | 719 | ||
| Income Statement | 719 | ||
| Statement of Retained Earnings | 720 | ||
| Statement of Stockholders’ Equity | 722 | ||
| How Do We Use Stockholders’ Equity Ratios to Evaluate Business Performance? | 723 | ||
| Earnings per Share | 723 | ||
| Price/Earnings Ratio | 724 | ||
| Rate of Return on Common Stock | 724 | ||
| Review | 725 | ||
| Assess Your Progress | 733 | ||
| Critical Thinking | 750 | ||
| CHAPTER 14 Long-Term Liabilities | 752 | ||
| How Are Long-Term Notes Payable and Mortgages Payable Accounted For? | 753 | ||
| Long-Term Notes Payable | 753 | ||
| Mortgages Payable | 754 | ||
| What Are Bonds? | 756 | ||
| Types of Bonds | 758 | ||
| Bond Prices | 758 | ||
| Present Value | 759 | ||
| Bond Interest Rates | 759 | ||
| Issuing Bonds Versus Issuing Stock | 760 | ||
| How Are Bonds Payable Accounted for Using the Straight-Line Amortization Method? | 761 | ||
| Issuing Bonds Payable at Face Value | 762 | ||
| Issuing Bonds Payable at a Discount | 762 | ||
| Issuing Bonds Payable at a Premium | 765 | ||
| How Is the Retirement of Bonds Payable Accounted For? | 767 | ||
| Retirement of Bonds at Maturity | 767 | ||
| Retirement of Bonds Before Maturity | 768 | ||
| How Are Liabilities Reported on the Balance Sheet? | 770 | ||
| How Do We Use the Debt to Equity Ratio to Evaluate Business Performance? | 771 | ||
| APPENDIX 14A: The Time Value of Money | 772 | ||
| What Is the Time Value of Money, and How Is the Present Value of a Future Amount Calculated? | 772 | ||
| Time Value of Money Concepts | 773 | ||
| Present Value of a Lump Sum | 775 | ||
| Present Value of an Annuity | 775 | ||
| Present Value of Bonds Payable | 776 | ||
| APPENDIX 14B: Effective-Interest Method of Amortization | 778 | ||
| How Are Bonds Payable Accounted for Using the Effective-Interest Amortization Method? | 778 | ||
| Effective-Interest Amortization for a Bond Discount | 778 | ||
| Effective-Interest Amortization of a Bond Premium | 779 | ||
| Review | 781 | ||
| Assess Your Progress | 786 | ||
| Critical Thinking | 799 | ||
| CHAPTER 15 Investments | 801 | ||
| Why Do Companies Invest? | 802 | ||
| Debt Securities Versus Equity Securities | 802 | ||
| Reasons to Invest | 802 | ||
| Classification and Reporting of Investments | 803 | ||
| How Are Investments in Debt Securities Accounted For? | 805 | ||
| Purchase of Debt Securities | 805 | ||
| Interest Revenue | 805 | ||
| Disposition at Maturity | 805 | ||
| How Are Investments in Equity Securities Accounted For? | 806 | ||
| Equity Securities with Less Than 20% Ownership (Cost Method) | 806 | ||
| Equity Securities with 20% to 50% Ownership (Equity Method) | 807 | ||
| Equity Securities with More Than 50% Ownership (Consolidations) | 810 | ||
| How Are Debt and Equity Securities Reported? | 810 | ||
| Trading Investments | 810 | ||
| Available-for-Sale Investments | 812 | ||
| Held-to-Maturity Investments | 814 | ||
| How Do We Use the Rate of Return on Total Assets to Evaluate Business Performance? | 815 | ||
| Review | 816 | ||
| Assess Your Progress | 822 | ||
| Critical Thinking | 830 | ||
| CHAPTER 16 The Statement of Cash Flows | 833 | ||
| What Is the Statement of Cash Flows? | 834 | ||
| Purpose of the Statement of Cash Flows | 834 | ||
| Classification of Cash Flows | 835 | ||
| Two Formats for Operating Activities | 837 | ||
| How Is the Statement of Cash Flows Prepared Using the Indirect Method? | 837 | ||
| Cash Flows from Operating Activities | 840 | ||
| Cash Flows from Investing Activities | 844 | ||
| Cash Flows from Financing Activities | 846 | ||
| Net Change in Cash and Cash Balances | 849 | ||
| Non-cash Investing and Financing Activities | 850 | ||
| How Do We Use Free Cash Flow to Evaluate Business Performance? | 852 | ||
| APPENDIX 16A: Preparing the Statement of Cash Flows by the Direct Method | 853 | ||
| How Is the Statement of Cash Flows Prepared Using the Direct Method? | 853 | ||
| Cash Flows from Operating Activities | 853 | ||
| APPENDIX 16B: Preparing the Indirect Statement of Cash Flows Using a Spreadsheet | 859 | ||
| How Is the Statement of Cash Flows Prepared Using the Indirect Method and a Spreadsheet? | 859 | ||
| Review | 863 | ||
| Assess Your Progress | 869 | ||
| Critical Thinking | 896 | ||
| CHAPTER 17 Financial Statement Analysis | 898 | ||
| How Are Financial Statements Used to Analyze a Business? | 899 | ||
| Purpose of Analysis | 899 | ||
| Tools of Analysis | 899 | ||
| Corporate Financial Reports | 899 | ||
| How Do We Use Horizontal Analysis to Analyze a Business? | 901 | ||
| Horizontal Analysis of the Income Statement | 902 | ||
| Horizontal Analysis of the Balance Sheet | 903 | ||
| Trend Analysis | 904 | ||
| How Do We Use Vertical Analysis to Analyze a Business? | 905 | ||
| Vertical Analysis of the Income Statement | 906 | ||
| Vertical Analysis of the Balance Sheet | 906 | ||
| Common-Size Statements | 908 | ||
| Benchmarking | 909 | ||
| How Do We Use Ratios to Analyze a Business? | 910 | ||
| Evaluating the Ability to Pay Current Liabilities | 911 | ||
| Evaluating the Ability to Sell Merchandise Inventory and Collect Receivables | 913 | ||
| Evaluating the Ability to Pay Long-Term Debt | 916 | ||
| Evaluating Profitability | 918 | ||
| Evaluating Stock as an Investment | 921 | ||
| Red Flags in Financial Statement Analyses | 923 | ||
| APPENDIX 17A: The Corporate Income Statement | 926 | ||
| How Is the Complete Corporate Income Statement Prepared? | 926 | ||
| Continuing Operations | 927 | ||
| Discontinued Operations | 928 | ||
| Extraordinary Items | 928 | ||
| Earnings per Share | 929 | ||
| Review | 929 | ||
| Assess Your Progress | 937 | ||
| Comprehensive Problem for Chapter 17 | 958 | ||
| Critical Thinking | 959 | ||
| APPENDIX A—2013 Green Mountain Coffee Roasters, Inc. Annual Report | 961 | ||
| APPENDIX B—Present Value Tables | 1009 | ||
| GLOSSARY | 1011 | ||
| A | 1011 | ||
| B | 1011 | ||
| C | 1011 | ||
| D | 1013 | ||
| E | 1013 | ||
| F | 1013 | ||
| G | 1014 | ||
| H | 1014 | ||
| I | 1014 | ||
| J | 1014 | ||
| K | 1015 | ||
| L | 1015 | ||
| M | 1015 | ||
| N | 1015 | ||
| O | 1015 | ||
| P | 1016 | ||
| R | 1016 | ||
| S | 1017 | ||
| T | 1018 | ||
| U | 1018 | ||
| V | 1018 | ||
| W | 1018 | ||
| INDEX | 1019 | ||
| Subject Index | 1019 | ||
| A | 1019 | ||
| B | 1019 | ||
| C | 1020 | ||
| D | 1020 | ||
| E | 1021 | ||
| F | 1021 | ||
| G | 1022 | ||
| H | 1022 | ||
| I | 1022 | ||
| J | 1023 | ||
| L | 1023 | ||
| M | 1023 | ||
| N | 1024 | ||
| O | 1024 | ||
| P | 1024 | ||
| Q | 1025 | ||
| R | 1025 | ||
| S | 1025 | ||
| T | 1026 | ||
| U | 1026 | ||
| V | 1027 | ||
| W | 1027 | ||
| Company Index | 1028 | ||
| A | 1028 | ||
| B | 1028 | ||
| C | 1028 | ||
| D | 1028 | ||
| E | 1028 | ||
| F | 1028 | ||
| G | 1028 | ||
| I | 1028 | ||
| J | 1028 | ||
| K | 1028 | ||
| L | 1028 | ||
| M | 1028 | ||
| N | 1028 | ||
| O | 1028 | ||
| P | 1028 | ||
| R | 1028 | ||
| S | 1028 | ||
| T | 1028 | ||
| U | 1028 | ||
| W | 1028 | ||
| Y | 1028 | ||
| PHOTO CREDITS | 1033 |