Intermediate Accounting DeMystiFieD - Softcover

Wink, Geri B.

Softcover

ISBN 10: 0071738851 ISBN 13: 9780071738859

Verlag: McGraw-Hill, 2010

Inhaltsangabe

Accounting as easy as 1-2-3!

Do you know the difference between FIFO and LIFO? Can you use the word dilutive in a sentence? Does thephrase "amortization of bond premiums" mean anything to you? No one said the journey to becoming a CPA is easy--but with Intermediate Accounting DeMYSTiFieD as your travel companion, you're guaranteed a smooth ride.

An easy-to-use self-teaching guide that reviews andexpands upon core Generally Accepted Accounting Principles (GAAP), Intermediate Accounting DeMYSTiFieD covers everything you need to ace your exams and take a big step toward the career of your dreams. The book provides a fresh review of all the basics, so you can easily glide into more advanced principles. You'll learn how to generateaccurate and reliable financial statements, maintain proper internal controls within a company, and locate international accounting standards.

This fast and easy guide offers:

• Tactics for maintaining solid internal controls within a business
• Strategies for creating accurate financial statements
• Techniques for overcoming common accounting errors
• Quizzes and a final exam for gauging what you've learned
• Tips and examples for mastering more advanced accounting theories

Simple enough for a novice but challenging enough for a veteran CPA, Intermediate Accounting DeMYSTiFieD is a shortcut to decoding key accounting concepts and principles.

Über diesen Titel

Über die Autorin bzw. den Autor

Geri Wink, CPA, is a lecturer in intermediate accounting at the Hasan School of Business, Colorado State University-Pueblo and also works as a Certified Public Accountant in both Colorado and Texas Her work has been published in Oil and Gas Quarterly and The Management Accountant.
Laurie Corradino is a student member of the American Institute of Certified Public Accountants, the Colorado Society of Certified Public Accountants, and other professional accounting organizations.

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Intermediate Accounting DeMYSTiFieD

By Geri B. Wink, Laurie Corradino

The McGraw-Hill Companies, Inc.

Copyright ©2011 The McGraw-Hill Companies, Inc.
All rights reserved.

ISBN: 978-0-07-173885-9

Contents

Acknowledgments
Introduction
Part I The Balance Sheet: Assets—What Do I Own?
CHAPTER 1 Cash and Accounts Receivable
CHAPTER 2 Inventory
CHAPTER 3 Long-Term Receivables
CHAPTER 4 Investments
CHAPTER 5 Property, Plant, and Equipment
CHAPTER 6 Intangibles
Part II The Balance Sheet: Liabilities—What Do I Owe?
CHAPTER 7 Current Liabilities
CHAPTER 8 Long-Term Liabilities
Part III The Balance Sheet: Stockholders' Equity—What Is Left Over?
CHAPTER 9 Contributed Capital
CHAPTER 10 Retained Earnings
CHAPTER 11 Earnings per Share
Part IV The Income Statement—How Much Have I Earned?
CHAPTER 12 Income Measurement
CHAPTER 13 Income Taxes
CHAPTER 14 Pensions
CHAPTER 15 Leases
Part V The Statement of Cash Flows—Where's the Cash?
CHAPTER 16 Cash Flow Statement
CHAPTER 17 Accounting Changes
CHAPTER 18 International Financial Reporting Standards
Final Exam
Answer Key
Appendix A
Appendix B
Index

Excerpt

CHAPTER 1

Cash and Accounts Receivable

CHAPTER OBJECTIVES

After completing this chapter, the student should

• Understand the financial statement presentation for cash and accountsreceivable

• Know what is included in and excluded from cash

• Account for petty cash transactions

• Complete a bank reconciliation

• Account for the direct write-off method

• Account for the allowance method using both the balance sheet and the incomestatement approaches

• Understand internal controls over cash and accounts receivable transactions

Overview

BLP, Inc., a newly established local wholesaler of clothing, has just opened abank account. The funds received by the company from sales and other revenuesources will be placed into that depository. Those funds, along with money thatis on hand at any given point in time, comprise BLP's cash. Because thecompany plans on offering its customers the option of making their purchases onaccount, some goods will be sold without any immediate inflow of cash. Torecognize that sale, however, an asset still will be recorded on BLP's books.That asset, known as accounts receivable, will reflect the sales priceof inventory that has been sold and that is expected to be realized in a shortperiod of time, usually within a month.

And with this foundation, welcome to the exciting world of intermediateaccounting. Yes, we know that the name and subject matter may seem frightening,but we also remember being in your shoes once, so do not fret. Whether you aretaking an intermediate class and are using this book as a supplement, are justtrying to learn a bit more about accounting, or are one of those crazy peoplelike us who really do enjoy playing with all these numbers, this book is sure tohelp you to understand accounting beyond the principles level. Intermediateaccounting is all about new accounts and rules, so do not expect it to be assimple as cash and accounts receivable. Like life, there are alwayscomplications and exceptions to the rules, and with those exceptions come newaccounts, so be prepared throughout this book to become friends with a whole newcrew (of accounts, that is—we can help you with numbers; as for yoursocial life, that is entirely up to you).

To help you better understand all those accounts and their relationships, wewill begin each chapter with a discussion of financial statement presentation.You would not set out on a trip to a new location without some specificdirections, so why do that with accounting? Consider the financial statements tobe your road map. Once you know where you are going, you can plan your trip muchbetter.

What will make your journey easier? Remember, we said easier, not easy.Undoubtedly, the best advice we can provide is that you need to understand theins and outs of every account. What exactly do we mean? You need to know anaccount's normal balance as well as the ways to increase or decrease itsbalance. In order to make this a bit easier and to refresh your memory fromprinciples, we have prepared a chart in Appendix A that we hope you will findhelpful. Appendix A lists each account discussed in this book by chapter alongwith its normal balance and financial statement classification. Remember thatyou always increase an account with its normal balance and decrease with theopposite balance. For example, cash has a normal debit balance, so to increasecash, you debit the account, and to decrease cash, you credit the account.

Financial Statement Presentation

Cash and accounts receivable are presented on the balance sheet in currentassets. Both accounts have normal debit balances. Remember that current assetsare listed in their order of liquidity. This therefore reserves the top seat forcash. Because there are some short-term investments (cash equivalents) that canbe converted into cash within a very short period of time, usually three monthsor less, cash and cash equivalents are often listed together as one account.Immediately following cash is the next most liquid asset, accounts receivable.

So what are the "personalities" of cash and accounts receivable? In other words,what do you need to specifically know about them? First, there are four itemsyou need to understand about cash: what can be considered cash, whatcannot be considered cash, how a petty-cash system works, and how toreconcile the cash account with the bank account to arrive at the true cashbalance presented on the balance sheet.

Cash

Cash Includes

Cash usually consists of

• Coins

• Currency

• Traveler's checks

• Negotiable checks

• Bank drafts

• Any unrestricted funds that are on deposit in the bank

Cash Exclusions

While they may seem like cash, the following items are not included as cash (andtheir proper classification is noted in parentheses):

• Certificates of deposit (short-term receivables)

• Bank overdrafts (current liabilities)

• Postdated checks (accounts receivable)

• Travel advances (prepaid expenses)

• IOUs (accounts receivable)

• Postage stamps (prepaid expenses)

Petty Cash

A petty cash account is used for small, frequent expenditures. It is likely thatmost of you have used a petty cash system at some point during your lives in thevarious companies for which you have worked. Use of a petty cash system is notrestricted to any size or type of firm. In fact, it is more uncommon for acompany not to have a petty cash reserve than it is for...

Details zur Ausgabe

• Verlag: McGraw-Hill
• Erscheinungsdatum: 2010
• Sprache: Englisch
• ISBN 10: 0071738851
• ISBN 13: 9780071738859
• Einband: Taschenbuch
• Anzahl der Seiten: 402
• Kontakt zum Hersteller: Nicht verfügbar
• Verantwortliche Person: Nicht verfügbar