Interpreting and Analyzing Financial Statements Book

Chapter 1: Introduction
Nike, Under Armour, Adidas WHAT IS ACCOUNTING?
THE FOUR FINANCIAL STATEMENTS THE BALANCE SHEET THE INCOME STATEMENT STATEMENT OF STOCKHOLDERS’ EQUITY STATEMENT OF CASH FLOWS GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (GAAP)
Historical Cost Principle INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRS)
RATIO ANALYSIS Debt Ratio Asset Turnover Ratio Return on Sales (ROS) Ratio Return on Assets (ROA) Ratio TREND ANALYSIS COMMON-SIZE STATEMENTS ACTIVITIES

Chapter 2: Balance Sheet
The Walt Disney Company, News Corp, Time Warner INTRODUCTION UNDERSTANDING THE WALT DISNEY COMPANY’S BALANCE SHEET Current Assets Noncurrent Assets Current Liabilities Noncurrent Liabilities INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRS)
DEBT VERSUS EQUITY ANALYZING THE BALANCE SHEET Liquidity: Current Ratio Solvency: Debt Ratio Trend Analysis Common-size Balance Sheet ACTIVITIES

Chapter 3: Income Statement
Amazon.com, Sears Holdings, eBay, Starbucks INTRODUCTION UNDERSTANDING AMAZON.COM’S INCOME STATEMENT STEP ONE: REVENUES — COST OF SALES = GROSS PROFIT Revenues and Revenue Recognition Expenses and the Matching Principle STEP TWO: GROSS PROFIT — OPERATING EXPENSES = OPERATING INCOME STEP THREE: OPERATING INCOME +/- NONOPERATING REVENUES AND EXPENSES = INCOME BEFORE INCOME TAX STEP FOUR: INCOME BEFORE INCOME TAX — PROVISION FOR INCOME TAX = INCOME FROM CONTINUING OPERATIONS STEP FIVE: INCOME FROM CONTINUING OPERATIONS +/- NONRECURRING ITEMS = NET INCOME ANALYZING THE INCOME STATEMENT Return on Sales Asset Turnover Ratio Return on Assets Gross Profit Margin Trend Analysis Common-Size Analysis ACTIVITIES

Chapter 4: Statement of Stockholders’ Equity
Freeport-McMoRan Copper & Gold INTRODUCTION STOCKHOLDERS’ EQUITY ON THE BALANCE SHEET STATEMENT OF STOCKHOLDERS’ EQUITY TREASURY STOCK RETAINED EARNINGS OTHER COMPREHENSIVE INCOME STOCK SPLITS & STOCK DIVIDENDS RETURN ON EQUITY FINANCIAL LEVERAGE RATIO TIMES INTEREST EARNED RATIO EARNINGS PER SHARE DIVIDEND RATE PRICE EARNINGS RATIO ACTIVITIES

Chapter 5: Statement of Cash Flows
Cedar Fair, L.P.
INTRODUCTION THREE CATEGORIES OF CASH FLOWS Financing Activities Investing Activities Operating Activities Operating Activities—The Direct Method Operating Activities—The Indirect Method INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRS)
ANALYZING THE STATEMENT OF CASH FLOWS Free Cash Flow Cash Flow Adequacy Cash Flow Liquidity Quality of Income ACTIVITIES

Chapter 6: Specific Accounts
Research in Motion Limited, Motorola Mobility, Inc.
INTRODUCTION CASH AND CASH EQUIVALENTS INVESTMENTS ACCOUNTS RECEIVABLE Accounts Receivable Turnover Accounts Receivable Days INVENTORY Specific Identification First-In, First-Out Last-In, First-Out International Financial Reporting Standards Gross Profit Margin Inventory Turnover Inventory Days PROPERTY, PLANT, AND EQUIPMENT Straight-Line Depreciation Double-Declining Balance Depreciation Comparing Straight-Line with Double-Declining Balance Gains and Losses on Sale of PPE International Financial Reporting Standards CURRENT AND LONG-TERM LIABILITIES ACTIVITIES

Chapter 7: The Accounting Cycle
INTRODUCTION THE 10-STEP ACCOUNTING CYCLE ANALYZE TRANSACTIONS USING THE ACCOUNTING EQUATION PREPARE JOURNAL ENTRIES USING DEBITS AND CREDITS Step 1: Analyze and Prepare Transaction Journal Entries (TJEs)
Step 2: Post TJEs to the Ledger Step 3: Prepare the Unadjusted Trial Balance Step 4: Prepare Adjusting Journal Entries (AJEs)
Step 5: Post AJEs to the Ledger Step 6: Prepare the Adjusted Trial Balance Step 7: Prepare the Financial Statements Step 8: Prepare Closing Journal Entries (CJEs)
Step 9: Post CJEs to the Ledger Step 10: Prepare the Post-Closing Trial Balance TRANSACTION JOURNAL ENTRIES OF A MERCHANDISE RETAILER MORE ADJUSTING JOURNAL ENTRIES ACTIVITIES

Chapter 8: Comprehensive Review
ACTIVITIES

Chapter 9: Capstone Project
ACTIVITIES APPENDIX A–FEATURED CORPORATIONS APPENDIX B–RATIOS GLOSSARY INDEX