Financial Accounting as a Second Language Book

Preface     ix
Basic Financial Accounting Concepts     1
Learning Objectives     1
Accounting as the Language of Business     2
Objectives of Financial Reporting     4
Basic Accounting Concepts     5
The Basic Financial Statements     8
Using Financial Statement Information     17
Review Questions     18
Practice Multiple Choice Questions     21
The Accounting Cycle     24
Learning Objectives     24
Transaction Analysis     26
The Accounting Cycle     29
Summary of the Seven Types of Accounts     30
The Rules for Debits and Credits     30
The Chart of Accounts     32
Cash Basis versus Accrual Basis     33
The Journal Entry     33
Recording Journal Entries     38
Posting to the Ledger     40
The Trial Balance     41
Adjusting Entries     41
The Closing Process     45
Balancing the Permanent Accounts     47
Correcting Errors     47
Preparing the Financial Statements     48
Comprehensive Illustration     49
ReviewQuestions     59
Practice Multiple Choice Questions     61
Internal Controls, Cash, and Receivables     64
Learning Objectives     64
The Sarbanes-Oxley Act Requirements     65
Sarbanes-Oxley and Internal Control     66
Reporting Cash     68
The Bank Reconciliation     70
Accounts Receivable     73
Notes Receivable     77
Getting Cash for Receivables     78
Summary of Journal Entries     79
Review Questions     80
Practice Multiple Choice Questions     83
Inventory     85
Learning Objectives     85
Basic Inventory Issues     86
Purchasing and Selling Inventory     89
The Cost of Goods Sold Model     91
The Periodic Method versus the Perpetual Method     92
Taking Inventory and the Cost Flow Assumptions     95
Lower of Cost or Market (LCM)     102
Impact of Inventory Errors     104
Review Questions     107
Practice Multiple Choice Questions     109
Noncurrent Assets and Depreciation     113
Learning Objectives     113
Noncurrent Assets      114
Long-Term Investments     114
Property, Plant, and Equipment     116
Declining-Balance Method     121
Depreciation Conventions     123
Intangible Assets     126
Impairment     129
Accounting for Research and Development     131
Summary of Journal Entries     132
Review Questions     133
Practice Multiple Choice Questions     135
Current and Noncurrent Liablities     139
Learning Objectives     139
Liabilities     140
Current Liabilities     140
Long-Term Liabilities     147
Summary of Journal Entries     154
Review Questions     155
Practice Multiple Choice Questions     158
Stockholders' Equity     160
Learning Objectives     160
Stockholders' Equity     162
Summary of Journal Entries     173
Review Questions     174
Practice Multiple Choice Questions     176
The Statement of Cash Flows     178
Learning Objectives     178
Objectives of the Statement of Cash Flows     179
Format of the Statement of Cash Flows      180
A Step-by-Step Approach to Solving Statement of Cash Flows Problems     182
Review Questions     202
Practice Multiple Choice Questions     203
Review of Financial Statements and Financial Statement Analysis     205
Learning Objectives     205
Horizontal and Vertical Analysis     206
DuPont Method     207
Financial Ratio Analysis     208
Review Questions     217
Practice Multiple Choice Questions     218
Basic College Skills     221
Learning Objectives     221
College Skills     222
The Time Value of Money     239
Learning Objectives     239
Introduction     239
Basic Concepts     239
Making Present Value and Future Value Calculations: A Summary     245
Practice Multiple Choice Questions     260
Gross Profit Inventory Computation     262
The Gross Profit Method     262
Advanced Topics for Chapter Five: Capitalization of Interest and Nonmonetary Exchanges     266
Capitalization of Interest on Self-Constructed Assets     266
Nonmonetary Exchanges     268
The Cpa and the Auditor's Report      272
Introduction     272
Generally Accepted Auditing Standards     273
Glossary     277
Index     299