Financial Accounting Book

Ch. 1	The final statements	2
	Spotlight : YUM! brands	2
	Business decisions	5
	Accounting : the language of business	5
	Accounting alert : we need an audit to validate the financial statements	7
	Accounting's foundation : principles and concepts	9
	The accounting equation	12
	The financial statements	14
	Relationships among the financial statements	22
	Making managerial decisions : in evaluating a company, what do decision makers look for?	24
Ch. 2	Transaction analysis	48
	Spotlight : Apple Computer, Inc.	48
	Transactions	50
	The account	50
	Accounting alert : single-entry accounting doesn't cut it	53
	Accounting for business transactions	53
	Double-entry accounting	62
	Recording transactions	65
	The trial balance	71
	Making managerial decisions : how to measure results of operations and financial position	76
Ch. 3	Using accrual accounting to measure income	104
	Spotlight : Callaway Golf Company	104
	Accrual accounting versus cash-basis accounting	106
	Accounting alert : cash-basis accounting doesn't cut it either	107
	Accounting alert : earnings management and cookie jar reserves	110
	Updating the accounts : the adjustment process	111
	Preparing the financial statements	124
	Formats for the financial statements	133
	Using accounting ratios	134
	Making managerial decisions : using the current ratio and the debt ratio	138
Ch. 4	Internal control & cash	172
	Spotlight : Merrill Lynch takes a hit	172
	Internal control	174
	Accounting alert : are the outside auditors really independent?	177
	Accounting alert : three faces of internal control	181
	The bank account as a control device	182
	Controlling and managing cash	189
	Ethics and accounting	193
	Making managerial decisions : ethical judgments	195
Ch. 5	Short-term investments & receivables	216
	Spotlight : how Ford Motor Company makes its money	216
	Short-term investments	218
	Accounting alert : is that investment really a current asset?	221
	Accounts and notes receivable	223
	Making managerial decisions : managing and accounting for receivables	225
	Accounting for uncollectible receivables	226
	Accounting alert : shifting sales into the current period makes you look good now, but you pay for it later	231
	Notes receivable	232
	Using two key ratios to make decisions	235
	Reporting on the statement of cash flows	237
Ch. 6	Merchandise inventory and cost of goods sold	260
	Spotlight : Pier 1 Imports	260
	Accounting for inventory	262
	Inventory costing	267
	Accounting principles related to inventory	274
	Inventory and the financial statements	276
	Additional inventory issues	278
	Accounting alert : cooking the books to increase reported income	281
	Making managerial decisions : accounting for inventory	283
App. 6A	Accounting in the periodic system	309
App. 6B	The LIFO reserve - converting a LIFO company's income to the FIFO basis	312
Ch. 7	Plant assets, natural resources, and intangibles	314
	Spotlight : UPS to the rescue	314
	Types of assets	316
	Accounting alert : is that cost really an asset?	320
	Measuring plant asset depreciation	320
	Other issues in accounting for plant assets	327
	Accounting for natural resources	334
	Accounting for intangible assets	334
	Reporting plant asset transactions on the statement of cash flows	337
	Making managerial decisions : plant assets and related expenses	340
Ch. 8	Current & long-term liabilities	362
	Spotlight : tough times for the airlines	362
	Current liabilities	364
	Accounting alert : are all your liabilities reported on the balance sheet?	370
	Long-term liabilities : bonds	372
	Making managerial decisions : financing with debt or with stock	386
	Long-term liabilities : leases and pensions	387
	Reporting liabilities	390
Ch. 9	Stockholders' equity	416
	Spotlight : IHOP goes public	416
	Organizing a corporation	419
	Issuing stock	422
	Accounting alert : a stock issuance for other than cash can pose an accounting problem	426
	Treasury stock transactions	429
	Retained earnings, dividends, and splits	431
	Measuring the value of stock	435
	Reporting stockholders' equity transactions	438
	Making managerial decisions : investing in stock	440
Ch. 10	Long-term investments & international operations	468
	Spotlight : the two parts of GE	468
	Stock investments : a review	470
	Available-for-sale investments	471
	Accounting alert : when should we sell that investment in Hewlett-Packard stock?	475
	Equity-method investments	485
	Consolidated subsidiaries	477
	Long-term investments in bonds and notes	481
	Making managerial decisions : accounting methods for long-term investments	482
	Accounting for international operations	484
	Investing activities on the statement of cash flows	490
Ch. 11	The income statement & the statement of stockholders' equity	500
	Spotlight : is something happening to best buy?	510
	Evaluating the quality of earnings	512
	Accounting alert : watch out for voluntary accounting changes that increase reported income	516
	Accounting alert : beware of pro forma earnings	519
	Accounting for corporate income taxes	519
	Analyzing retained earnings	521
	Analyzing the statement of stockholders' equity	522
	Responsibility for the financial statements	524
	Making managerial decisions : using the income statement and related notes in investment analysis	526
Ch. 12	The statement of cash flows	546
	Spotlight : eBay outlines global business strategy	546
	Basic concepts : the statement of cash flows	548
	Accounting alert : how's your cash flow? : telltale signs of financial difficulty	549
	Preparing the statement of cash flows : indirect method	551
	Preparing the statement of cash flows : direct method	564
	Measuring cash adequacy : free cash flow	573
	Making managerial decisions : investor's and creditors' use of cash flow and related information	574
Ch. 13	Financial statement analysis	606
	Spotlight : how well is YUM! doing?	606
	Horizontal analysis	608
	Vertical analysis	611
	Benchmarking	613
	Using ratios to make business decisions	617
	Accounting alert : the limitations of ratio analysis	620
	Other measures	627
	Accounting alert : red flags in financial statement analysis	628
	Making managerial decisions : using ratios in financial statement analysis	629
App. A	YUM! Brands annual report 2003	659
App. B	Pier 1 Imports annual report 2004	671
App. C	Time value of money : future value and present value	679
App. D	Typical charts of accounts for different types of businesses	689
App. E	Summary of generally accepted accounting principles (GAAP)	691
App. F	Check figures	693