STH1e-preface

Rev. Confirming Pages
Dedicated to:
David’s wife Charlene, daughters Denise and Jessica,
and sons Michael David, Michael, and David
Wayne’s wife Julee, daughter Olivia, and three sons Jake, Eli,
and Luke
Don’s father Richard Herrmann, wife Mary, daughter Rachel,
and three sons David, Nathan, and Micah
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About the Authors
DAVID SPICEL AND
David Spiceland is professor of
accounting at the University of
Memphis, where he teaches intermediate accounting and other financial
accounting courses at the undergraduate and master’s levels. He
received his BS degree in finance
from the University of Tennessee, his MBA from Southern
Illinois University, and his PhD in accounting from the
University of Arkansas.
Professor Spiceland’s primary research interests are in
earnings management and educational research. He has
published articles in a variety of journals including The Accounting Review, Accounting and Business Research, Journal
of Financial Research, and Journal of Accounting Education. David has received university and college awards and
recognition for his teaching, research, and technological
innovations in the classroom. David is lead author of McGraw-Hill’s best-selling Intermediate Accounting text.
David is the Memphis Tigers’ No. 1 basketball fan. He
enjoys playing basketball, is a former all-state linebacker,
and an avid fisherman. Cooking is a passion for David,
who served as sous chef for Paula Deen at a Mid-South
Fair cooking demonstration.
WAYNE THOMAS
Wayne Thomas is the John T. Steed
Chair in Accounting at the University of Oklahoma, where he teaches
introductory financial accounting to nearly 600 students per year.
He received his bachelor’s degree
in accounting from Southwestern
Oklahoma State University, and his
master’s and PhD in accounting from Oklahoma State
University.
Professor Thomas’s primary research interests are in
markets-based accounting research, financial disclosures,
financial statement analysis, and international accounting
issues. He currently serves as an editor of The Accounting
Review and has published articles in a variety of journals
including The Accounting Review, Journal of Accounting
and Economics, Journal of Accounting Research, Review
of Accounting Studies, and Contemporary Accounting
Research. He has won several research awards, including
the American Accounting Association’s Competitive Manuscript Award. Professor Thomas has teaching awards at
the university, college, and departmental level, and has
received the Outstanding Educator Award from the Oklahoma Society of CPAs.
Wayne enjoys playing sports (basketball, tennis, golf,
and ping pong), solving crossword puzzles, and coaching
little league sports. He has participated in several adventure races, like you’ll read about in the Great Adventures
continuation problem at the end of each chapter.
DON HERRMANN
Don Herrmann is the Arthur Andersen Professor of Accounting at
Oklahoma State University, where
he teaches financial accounting,
intermediate accounting, and a
doctoral-level course in financial
accounting research. He received
his bachelor’s degree in business
from John Brown University, his master’s degree in accounting from Kansas State University, and his PhD in accounting from Oklahoma State University.
Professor Herrmann’s research interests are in earnings
forecasts, segment reporting, financial statement analysis,
and international accounting issues. He is past president
of the American Accounting Association International
Section and has served on the editorial and review board
of the top research journal in the field of accounting, The
Accounting Review. He has published articles in a variety
of journals including The Accounting Review, Journal of
Accounting Research, Accounting Horizons, Journal of
Business, Finance, and Accounting, and the Journal of Accounting and Public Policy. Don Herrmann and Wayne
Thomas often work together, having co-authored over 15
research articles. Professor Herrmann has received many
teaching awards at the department, college, and university levels including Professor of the Year in the University
Greek System.
Don, like his co-authors, is a big sports fan. He played
tennis on scholarship in college and enjoys playing soccer, basketball, running, biking, and swimming. He also
coaches soccer, basketball, and little league baseball in his
hometown.
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CELEBRATING STUDENT SUCCESS
I read the book in two
weekends and was so delighted
in the quality of content and the
presentation style.—Steven Ault, Montana
State University
An exciting new approach, very
readable, focused on real companies
and decision making.—Laurel Bond Mitchell,
University of Redlands
You have created a text that is likely to
become the gold standard of Intro
texts.—Christian Wurst, Temple University
H
ave you experienced those moments in your
course when students became fully engaged?
When the “ahh-haa!” revelations are bursting
like fireworks? David Spiceland, Wayne Thomas, and
Don Herrmann have developed a unique new text
based on over 50 collective years of experience in the
classroom. They’ve brought together best practices
like highlighting Common Mistakes, offering frequent
Stop-and-Review Problems, integrating the course
with a running Continuing Problem, demonstrating
the relevance of the course to nonmajors with a Career
Corner, and communicating it all in a student-friendly
Conversational Writing Style. Financial Accounting
will not only motivate, engage, and challenge students
but illuminate the financial accounting course like
never before.
This is the best accounting
text that I have seen. It
is easy to understand,
has a logical sequence, is
succinct, and removes the
complexity of accounting.
The reading flows from one topic
to the next in an interesting and
informative style.—Marjorie Ashton,
Truckee Meadows Community College
If you like Spiceland’s
intermediate text, you
will be thrilled with the
financial accounting
principles text. It is written
in the same conversational
style, addresses topics directly
and clearly, and the illustrations
are terrific too.—Nancy L. Snow,
University of Toledo
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Key to Financial Accounting’s remarkably
positive reception are the five core precepts
around which the text is built
1
Conversational Writing Style The authors took
special care to write a textbook that fosters a
friendly dialogue between the text and each individual student. The tone of the presentation is
intentionally conversational—creating the impression of speaking with the student, as opposed to teaching to the student.
The authors successfully employ
humor and a conversational
writing style in developing scenarios,
examples and explanations which
remain in the reader’s mind and make
these oftentimes complicated subjects
understandable.—Dennis L. Kovach,
Community College of Allegheny County
It offers a very readable
presentation, with easy to
follow pedagogy. The writing
is clear and crisp—it is not
boring.—Al Hartgraves, Emory University
3
4
5
2
Real-World Focus Students learn best
when they see how concepts are applied
in the real world. For that reason, realworld examples from companies, such
as Nike and UnderArmour, are used
extensively and routinely to enhance the
presentation. The real-world focus adds
realism to discussions and serves as the
foundation for exercises, problems, and
cases.
Innovative Pedagogy Reviewers enthusiastically embraced the innovative pedagogy used
throughout the book, including Stop-and-Review chapter quizzes, Common Mistake boxes
that help students avoid common pitfalls of beginning students, and Flip Side problems and
scenarios that show students the two sides of
various accounting transactions.
Decision Maker’s Perspective Each chapter
includes one or more distinctive Decision Maker’s
Perspective sections, which offer insights into how
the information discussed in the chapters affects
decisions made by investors, creditors, managers, and
others. Each chapter also contains Decision Points
highlighting specific decisions in the chapter that can
be made using financial accounting information.
A very readable,
engaging text that
has the right breadth
and depth of coverage,
including “mechanics,”
to satisfy both
accounting and nonaccounting majors, plus
a excellent selection of
ancillaries.—Ron Burrows,
University of Dayton
A Strong Supplements Package The authors
write all of the major supplements for Financial
Accounting, including the Testbank, Solutions
Manual, and the Instructor’s Manual. With iPod material (including slideshows and
multiple choice quizzes), narrated PowerPoints, online quizzing, and QuickBooks templates
integrated into the end-of-chapter material, Spiceland’s Financial Accounting provides the
cutting-edge technology demanded by today’s accounting instructors and students.
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A LOGICAL ORGANIZATION
The sequence of topics is inspired, and
I wonder why it hasn’t been done before.—Laurel
Bond Mitchell, University of Redlands
Chapter 1 of Spiceland is excellent. It provides a concise, yet
comprehensive introduction to financial accounting. It is written
in an easy-to-understand and pleasant style that should
1
Accounting
Information and
Decision Making
2
3
The Accounting
Information System
motivate students’ interest.—Marianne James, California State University–
Los Angeles
Really like the thoroughness of the transaction analysis,
journal entries, and impact on accounts.—Deborah Beard,
Southeast Missouri State University
STH goes beyond the “textbook” mode and discusses/
presents in pictures, diagrams, etc, and I think it makes the whole
The Financial
Reporting Process
adjusting process much easier to understand.—Peter Theuri, Northern
Kentucky University
Excellent coverage of basic accounting topics—lays a good
foundation for intermediate courses.—Laura DeLaune, Louisiana State
University
The inventory chapter in Spiceland is the best
I’ve ever seen!—James Aitken, Central Michigan
University
Good, comprehensive but readable walk through the
many types of property transactions. Chapter 7 does an
especially good job in talking about intangible
assets.—Laura Ilcisin, University of Nebraska–Omaha
The Spiceland chapter is excellent; it provides
comprehensive, yet easy to understand
discussions, and effective development of concepts
and coverage of the topics related to current
viii
liabilities.—Marianne James, California State University–Los
4
5
6
7
8
Cash and Internal
Controls
Receivables
and Sales
Inventory and Cost
of Goods Sold
Long-Term Assets
Current Liabilities
Angeles
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THAT MAKES LEARNING MORE EFFICIENT
I became quite excited about this text after I started reading
through Chapter 9. It is well written and is written at a level my
students would not find difficult. It also takes an approach
9
10
11
12
that is more student friendly.—Robert W. McGee, Barry
Long-Term
Liabilities
Stockholders’
Equity
University
I REALLY enjoyed this chapter. Our current book is very good. However,
Spiceland has presented this chapter in a very interesting manner. I like the
simplicity of the presentation. I especially like the “Decision Maker’s Perspectives”
throughout the chapter. Not only is this chapter well-written, it is interesting!—Steve
Teeter, Utah Valley State College
Statement of
Cash Flows
The preparation of the statement of cash flows is
simplified. As always, the content is very easy to read
Financial Statement
Analysis
and understand. The direct method presentation is
the best that I have ever read.—Marjorie Ashton, Truckee
Meadows Community College
Wow! I was really impressed with this chapter! The conservative and aggressive accounting example
was really a great way to teach students about quality of earnings. The rest of the chapter was
also put together very well. Great ratio illustration with Under Armour and Nike, two companies that
students are interested in.—Christa Morgan, Georgia Perimeter College
Appendix A Annual
Report of American Eagle
Outfitters, Inc.
Appendix B Annual
Report of The Buckle, Inc.
The text contains realistic
examples, excellent
explanations, and illustrated
example problems within the
text. The EOC material is also well
done. It is definitely worth
looking at for adoption.—Kreag
Danvers, Clarion University of PA
Appendix C
Time Value of Money
Appendix D
International Financial
Reporting Standards
I believe the big difference is
the way in which topics are
grouped. It covers the same
material that most texts cover,
and it still utilizes debits/credits,
but the authors attempt to
present much more
related material together
whenever possible.—Douglas A.
Larson, Salem State College
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A DECISION-MAKING PERSPECTIVE
Since all business majors have to
all of these changes affect financial income, but not taxable income.
Decision Maker’s
Perspective
take the first year of accounting,
Look Out for Earnings Management at Year-End
Let’s assume you’re an auditor and all four of the final changes to the accounting
records for the year increase income. Wouldn’t you be a little concerned? It may be
that all four adjustments are perfectly legitimate, but it also may be an indication
management is inflating earnings. Year-end adjustments, especially those with an
increasing or decreasing pattern, should be investigated with greater skepticism. ■
How do positive changes to net income affect the balance sheet? Illustration
12–30 presents the balance sheet prepared by Mr. Sampras, the effect of the four
accounting changes, and the updated balance sheet prepared by Mr. McEnroe.
Balance Sheet Revised
by Mr. McEnroe
Sampras
Assets
Cash
Accounts receivable
Inventory
Buildings
Less: Acc. depr.
Total Assets
$ 2,300,000
1,500,000
2,800,000
11,000,000
(2,000,000)
$15,600,000
Accounts payable
Litigation liability
Common stock
Retained earnings
Total liabilities and stockholders’
equity
$1,450,000
1,500,000
8,000,000
4,650,000
$15,600,000
accounting often do not see the
relevance in taking the course.
These perspectives show those
non-accounting major students
FEDERER SPORTS APPAREL
Balance Sheet
December 31
ILLUSTRATION 12–30
students who are not majoring in
how and why they will use
Changes
60,000
200,000
500,000
760,000
McEnroe
$ 2,300,000
1,560,000
3,000,000
11,000,000
(1,500,000)
$16,360,000
2,260,000
$ 1,450,000
0
8,000,000
6,910,000
760,000
$16,360,000
(1,500,000)
accounting information. These
are EXCELLENT!—Marjorie
Ashton, Truckee Meadows Community
College
I think these [Decision Point] boxes will be helpful, especially for the non-accounting
students. My classes tend to stress the implications of the accounting
information to a higher degree than the mechanics of accounting, since only a portion
of my students are accounting majors. These boxes do the same thing.—Joshua Herbold,
University of Montana
,
g
y
q
Question
y
Accounting Information
Analysis
Times interest earned ratio
A high times interest earned
ratio indicates the ability
of a company to meet its
interest obligations.
Decision Point
?
Can a company meet its
interest obligations?
Any student would benefit from this feature [Decision
Points]. I love it.—Peter Theuri, Northern Kentucky University
This is the type of material instructors often discuss in class and I believe it
is helpful to student understanding. Indicates to students that what they are studying
is useful.—Thomas Brady, University of Dayton
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THAT RESONATES WITH INSTRUCTORS
The discussions and
illustrations relating
Income Statement
Balance Sheet
to the four financial
Stockholders’ Equity
statements and how the
transactions affect the
financial statements
are very clear and
effective; in addition,
Assets
Common
Retained
= Liabilities + Stock + Earnings
+392
=
−8
−8
=
−8
−400
−8
the use of a different
color for each statement
is very effective.—Marianne
Tenet Healthcare Corporation
Net Sales
(in millions)
Average
Accounts
Receivable
(in millions)
2005
$8,614
$1,607
2006
$8,701
$1,469
James, California State University
–Los Angeles
Net
Revenues − Expenses = Income
ILLUSTRATION 5–15
Receivables
Turnover Ratio
Average
Collection
Period
$8,614
= 5.36
$1,607
$8,701
= 5.92
$1,469
365
= 68.1
5.36
365
= 61.7
5.92
Net
Income
(Loss)
($724)
Comparison
of Receivables
Ratios between
Tenet Healthcare
Corporation and
LifePoint Hospitals
($803)
LifePoint Hospitals
2005
$1,842
$ 186
2006
$2,440
$ 291
$1,842
= 9.90
$186
$2,440
= 8.38
$291
365
= 36.9
9.90
365
= 43.6
8.38
$ 73
$146
Your book more clearly explains and gives illustrations of the
differences between perpetual and periodic inventory systems.—Benny R.
Zachry, Nicholls State University
We use the purchases account to temporarily track increases in inventory. This
account is a temporary account that we close to cost of goods sold at the end of the
period. We’ll see this period-end closing entry later.
Perpetual System
Inventory
Accounts Payable
55,000
55,000
Periodic System
Purchases
Accounts Payable
55,000
55,000
The buyer records the purchase when title to the inventory transfers from the
seller. This often takes place immediately as the seller hands the goods to the buyer.
However, in some cases the goods must be shipped. In this case, there is a delay
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UNIQUE PEDAGOGICAL ELEMENTS
Common Mistakes made by financial accounting students are
highlighted throughout each of the chapters. With greater awareness of the pitfalls the average student will find in their first accounting class, students can avoid making the same mistakes and
gain a deeper understanding of the chapter material.
Easy to read, love the Key Points and Common Mistakes—these sound
like me talking to my students and are exactly the points I make in
class! Really!—Christa Morgan, Georgia Perimeter College
Most of the common mistakes are warnings that I have in my
lectures.—Lisa N. Bostick, The University of Tampa
Accounting is not a number-crunching desk job.
As the foundation for much of the business world
(many business professionals call accounting the
“language of business”), a solid understanding of
accounting can lead to a wide variety of job opportunities. The Career Corner boxes highlight the
exciting career opportunities in accounting and the
important role that accountants play. These also
discuss how nonaccountants use accounting information in their business functions.
Because of the widespread adoption of international financial reporting standards issued by the
International Accounting Standards Board (IASB),
differences between international standards and
U.S. GAAP are highlighted throughout the text in
International Financial Reporting Standards boxes.
International accounting
standards are very
relevant today. Students
need to be aware of them
since we will all probably be
using them soon. I enjoyed
reading the discussion.—Richard
Moellenberndt, Washburn University
The Key Points provide quick synopses of the critical pieces of information
presented throughout each chapter.
Very easy to read!!! I like the key points and common mistakes
segments in each chapter. These features would really help my
students as they read the textbook and study for exams. I also like the
simplicity of each chapter.—David Juriga, St. Louis Community College
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HELP IGNITE THE LEARNING PROCESS
Similarly, students will be acquainted with ethical implications of topics under
discussion by the inclusion of short Ethical Dilemma boxes. The need to discuss
ethics in accounting has become evident in light of recent accounting scandals.
This is a good approach because it will give students an opportunity
to develop their critical thinking ability by comparing situations that
they have not experienced before.—Seleshi Sisaye, Duquesne University
The “Flip-Side” and “Common
Mistakes” sections are outstanding
and are likely to be among
the favorite parts of the
book for students.—Christian Wurst,
Temple University
A financial transaction always involves
two parties—the Flip Side feature
demonstrates how various transactions
are viewed by each participant. Including
the “flip side” of a transaction—in
context—enhances the student’s
understanding of both the initial and the
related transaction. Selected homework
in the end-of-chapter materials also
includes the Flip Side transactions for
students to reinforce their understanding
of this concept.
Each chapter contains one or more “quick quizzes” with key concepts and
solutions. These short review questions and answers are intended to reinforce the
students’ understanding of specific chapter material and allow them to review
and practice applying the concepts and procedures learned in the chapter prior to
attempting their homework assignment.
Stop-and-Review Problems immediately follow each distinct topic within chapters
to review the topic before moving on to the next section. The Stop-and-Review
problems are designed to foreshadow the end-of-chapter assignment material.
Each is followed by a detailed solution that students can use as a template to help
in solving end-of-chapter assignments.
This text provides a user-friendly approach to accounting with several unique
features that will hold students’ interest (feature story, key points, illustrations)
and help them learn the material easily (common mistakes, quick quiz,
stop-and-review).—Susan Wessels, Meredith College
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PRACTICE MAKES PERFECT WITH
SELF-STUDY QUESTIONS
1. Accounts receivable are best described as:
a. Liabilities of the company that represent the amount owed to suppliers.
b. Amounts that have previously been received from customers.
c. Assets of the company representing the amount owed by customers.
d. Amounts that have previously been paid to suppliers.
■ LO1
2. On March 17, Fox Lumber sells materials to Whitney Construction for $12,000,
terms 2/10, n/30. Whitney pays for the materials on March 23. What amount would
Fox record as revenue on March 17?
a. $12,400.
b. $11,760.
c. $12,000.
d. $12,240.
■ LO2
3. Refer to the information in the previous question. What is the amount of net
revenues (sales minus sales discounts) as of March 23?
a. $0.
b. $11,760.
c $12 000
■ LO2
Self-Study Questions consist of 10 multiple
choice questions in each chapter. Answers
appear at the end of the respective chapters.
Students also are directed to the course
Web site where these same questions are
available in the form of self-grading online
quizzes with a more detailed analysis of
correct and incorrect answers.
In making an adoption decision, recognizing the topical coverage is most critical,
I would not hesitate to adopt this text from the perspective of the assignments.
—Ron Burrows, University of Dayton
Review Questions are provided
for each of the major concepts
in each chapter, providing
students with an opportunity to
review key parts of the chapter
and answer evocative questions
about what they have learned.
REVIEW QUESTIONS
1. Identify and briefly describe the three categories of cash flows reported in the
statement of cash flows.
2. Changes in which balance sheet accounts are used in determining net cash flows
from operating activities, investing activities, and financing activities?
3. Explain what we mean by noncash activities and provide an example.
4. Why is it necessary to use an income statement, balance sheets, and additional
information to prepare a statement of cash flows?
5. Describe the basic format used in preparing a statement of cash flows, including
the heading, the three major categories, and what is included in the last three lines
of the statement.
6. Briefly describe the four steps outlined in the text for preparing a statement of
cash flows
Well-written book with excellent features throughout each chapter. Plenty of
material at the end of the chapter to give students extra practice.—Chris McNamara,
Finger Lakes Community College
BRIEF EXERCISES
BE10–1 Waldo is planning to start a clothing store helping big and tall men blend in
with the crowd. Explain to Waldo the advantages and disadvantages of a corporation
in comparison to a sole proprietorship or partnership.
Advantages and
disadvantages of a
corporation (LO1)
BE10–2 Renaldo heard that an S corporation combines the benefits of a corporation
with the benefits of a partnership. Explain to Renaldo the specific benefits of an
S corporation and any drawbacks to organizing as an S corporation.
Understand an
S corporation (LO1)
BE10–3 Western Wear Clothing issues 2,000 shares of its $0.01 par value common
stock to provide funds for further expansion. If the issue price is $12 per share, what is
the journal entry to record the share issue?
Issuance of common
stock (LO2)
BE10–4 Gothic Architecture is a new chain of clothing stores specializing in the color
black. Gothic issues 1,000 shares of its $1 par value common stock at $20 per share.
Record the issuance of the stock. How would the entry differ if Gothic issued no-par
value stock?
Issuance of common
stock (LO2)
BE10–5 Equinox Outdoor Wear issues 1,000 shares of its $0.01 par value preferred
stock for cash at $22 per share. Record the issuance of the preferred shares.
Issuance of preferred
stock (LO3)
Brief Exercises address single concepts
from a single perspective. These exercises
are ideal for quick demonstrations of
simple topics in class or short take-home
assignments.
Flip Side of BE10–15
Brief exercises are an important part of
student learning (particularly given the
learning style of today’s student).—Dawn Massey,
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A WIDE VARIETY OF ASSIGNMENT MATERIAL
Exercises typically add one or more
additional dimensions
to the same topics covered with Brief
Exercises.
EXERCISES
Determine proper
classification of
liabilities (LO1)
This text is very complete, readable, with several
exercise and problem possibilities. It has some new
and innovative features, including the “Key Point, Common
E8–1 Match (by letter) the correct reporting method for each of the items listed below.
Reporting Method
C. Current liability
L. Long-term liability
D. Disclosure note only
N. Not reported
Item
1.
2.
3.
4.
5.
6.
7.
Mistake, and Career Corner” boxes. This text also introduces
the Cash Flow Statement fundamentals early in the text, to
enhance learning the difference between cash and accrual
Accounts payable.
Current portion of long-term debt.
Sales tax collected from customers.
Notes payable due in two years.
Customer advances.
Commercial paper.
Unused line of credit.
basis.—Mary Hollars, Vincennes University
Problems typically address
multiple concepts from the chapter
or multiple levels of analytical
perspective within the given
scenarios. Where feasible, problems
are built around real companies and
business situations.
PROBLEMS: SET A
Review current liability
terms and concepts (LO1)
Each chapter provides twin sets
of problems to offer instructors
flexibility in presentation and
assignment. The material in Problem
Set A is similar in format to the
material in Problem Set B, and each
set reinforces the other.
This text is very well written and offers
a set of end-of-chapter problems that
P8–1A Listed below are several terms and phrases associated with current liabilities.
Pair each item from List A (by letter) with the item from List B that is most
appropriately associated with it.
List A
PROBLEMS: SET
Match terms with their
definitions (LO1 to 8)
List B
1. An IOU promising to repay the amount
a. Recording of a loss
borrowed plus interest.
contingency.
b. Unearned revenues.
2. Loss is reasonably possible and can be
c. The riskiness of a
reasonably estimated.
business’s obligations.
3. Mixture of liabilities and equity a business
d. Disclosure of a loss
uses.
contingency.
4. Loss is probable and can be reasonably
e. Interest on debt.
estimated.
f. Payroll taxes.
5. A liability that requires the sacrifice of
g. Line of credit.
something other than cash.
h. Capital structure.
6. Long-term debt maturing within one year.
i. Notes payable.
B7. FICA and FUTA.
j. Current portion of
8. Informal agreement that permits a company
long-term debt.
to borrow up to a prearranged limit.
P10–1B Match (by letter) the following terms with their definitions. Each letter is used
only once.
Terms
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
PE ratio.
Stockholders’ equity section of the balance sheet.
Accumulated deficit.
Growth stocks.
100% stock dividend.
Statement of stockholders’ equity.
Treasury stock.
Value stocks.
Return on equity.
Retained earnings.
Definitions:
a. A debit balance in retained earnings.
progressively challenges students and
directs them to build problem-solving
skills.—Gregg S. Woodruff, Western Illinois University
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CHALLENGE YOUR STUDENTS TO SEE
AN ADDITIONAL PERSPECTIVE
The Additional Perspectives section of each chapter offers the most distinctive variety
of case material available in financial accounting textbooks. Cases and activities
are designed to allow students to apply the knowledge and skills they’ve learned in
provocative, real, or realistic situations. Students are placed in the role of decision
maker, presented with a set of information, and asked to draw conclusions that test their
understanding of the issues discussed in the chapters. Each chapter offers an engaging
mix of activities and opportunities to perform real-world financial accounting analysis:
ADDITIONAL PERSPECTIVES
Great Adventures
(This is a continuation of the Great Adventures problem from earlier chapters.)
AP9–1 Tony’s favorite memories of his childhood were the times he spent with his
dad at camp. Tony was daydreaming of those days a bit as he and Suzie jogged along
a nature trail and came across a wonderful piece of property for sale. He turned to
Suzie, “I’ve always wanted to start a camp where families could get away and spend
some quality time together. If we just had the money, I know this would be the perfect
place.” They called several banks and on January 1, 2012, Great Adventures obtained
a $500,000, 6%, 10-year installment loan from Summit Bank. Monthly payments of
$5,551 are required at the end of each month over the life of the 10-year loan. Each
monthly payment of $5,551 includes both interest expense and principal payments
(i.e., reduction of the loan amount.)
Late that night Tony exclaimed, “$500,000 for our new camp, this has to be the best
news ever.” Suzie snuggled close and said, “There’s something else I need to tell you,
Tony, I’m expecting!” They decided right then, if it was a boy, they would name him
Venture.
Continuing
Problem
Continuing Problem—The story of Great
Adventures progresses from chapter to chapter,
encompassing the accounting issues of each new
chapter as the story unfolds. This progressive
problem allows students to see how each chapter’s
topics can be integrated into the operations of a
single company.
The book is very detailed, but not overly
technical. The book is written at a level and in
a way that is highly user friendly.—Peter Woodlock,
Youngstown State University
American Eagle Outfitters, Inc.
AP9–2 Financial information for American Eagle is presented in Appendix A at the
end of the book.
Financial Analysis
Required:
1. Calculate the debt to equity ratio for the past two years. Did the ratio improve or
weaken in the more recent year?
2. Calculate the return on equity. Would investors obtain a higher return on equity if
American Eagle borrowed more money?
3. Review the balance sheet and note 6 to the financial statements. Based on this
The Buckle, Inc.
information, how would you rate the bankruptcy risk of American Eagle?
AP4–3 Financial information for The Buckle is presented in Appendix B at the end of
the book.
Financial Analysis: American Eagle Outfitters,
Inc.—Students are asked to gather information from
the annual report of American Eagle, located in
Appendix A.
Financial Analysis
Required:
1. What does the Report of Independent Registered Public Accounting Firm indicate
about The Buckle’s internal controls?
2. In the summary of significant accounting policies, how does The Buckle define cash
equivalents?
3. What is the amount of cash reported in the two most recent years? By how much
has cash increased/decreased?
4. Determine the amounts The Buckle reports for net cash flows from operating
activities, investing activities, and financing activities in its statement of cash flows
for the most recent year What are total cash flows for the year?
Financial Analysis: The Buckle, Inc.—
Students are asked to gather information
from the annual report of The Buckle,
located in Appendix B.
A new, promising text in financial
accounting is emerging.—Ahmed
Ebrahim, State University of New York–New Paltz
American Eagle Outfitters, Inc.
AP4–2 Financial information for American Eagle is presented in Appendix A at the
end of the book.
Required:
1. What does the Report of Independent Registered Public Accounting Firm indicate
about American Eagle’s internal controls?
2. In the summary of significant accounting policies, how does American Eagle define
cash equivalents?
3. What is the amount of cash reported in the two most recent years? By how much
has cash increased/decreased?
Financial Analysis
Comparative Analysis—In addition to separately
analyzing the financial information of American
Eagle and The Buckle, students are asked to
compare financial information between the two
companies.
Difficult topics are handled in a manner to facilitate the students’ learning. Overall the book is
very good and worth considering.—Tommy Moores, University of Nevada–Las Vegas
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WITH THESE UNIQUE
END-OF-CHAPTER CASES
Ethics
AP9–5 Coney Island Entertainment is struggling financially and its CFO, David Givens,
is starting to feel the heat. Back on January 1, 2010, Coney Island Entertainment
issued $100 million of 6% bonds, due in 15 years, with interest payable semi-annually
on June 30 and December 31 each year. The market interest rate on the date of issue
was 5%.
It is now the end of 2014, and David has a plan to increase reported net income
in 2014. The market interest rate has risen to 9% by the end of 2014. David wants to
retire the $100 million, 6% bonds and reissue new 9% bonds instead.
Ethics—Encourage consideration of ethical issues as
they pertain to accounting decisions including the
outcome of those decisions on various stakeholders.
Required:
1. Show that the bonds originally were issued on January 1, 2010, for $110,465,146.
2. Calculate the carrying value of the bonds five years later on December 31, 2014.
(Hint: Use a market rate of 2.5% [5%/2], and the number of periods is now 20 semiannual periods.)
3. Calculate the market value of the bonds five years later on December 31, 2014.
(Hint: The market rate is now 4.5% [9%/2] rather than 2.5% [5%/2] and the number
of periods is now 20 semi-annual periods.)
4. Record the early retirement of the bonds on December 31, 2014. Does the
transaction increase Coney Island’s net income? By how much (ignoring any tax
effect)?
Students are given opportunities for feedback of
their understanding of concepts and procedures
by taking quizzes and working review problems
at break points within the chapter. The text has a
large quantity and variety of quality endof-chapter assignment material.—Tommy Moores,
University of Nevada – Las Vegas
Internet Research—Allow students to develop and
practice research skills by requiring them to locate
and extract relevant information from available
resource material such as financial reports or official
standards on the Internet, perhaps identifying the
appropriate resources to support a decision.
Internet Research
AP4–6 Financial accounting information can often be found at financial websites.
These websites are useful for collecting information about a company’s stock price,
analysts’ forecasts, dividend history, historical financial accounting information, and
much more. One such site is Yahoo! Finance (finance.yahoo.com).
Required:
1. Visit Yahoo! Finance and get a stock quote for Google. To do this, type “GOOG” in
the “Get Quotes” box. Under “Financials” click on the “Cash Flow” link. Calculate
Google’s free cash flows for the three most recent years.
2. Calculate IBM’s free cash flows in the same way by typing “IBM” in the “Get
Quotes” box.
3. Compare the trends in free cash flows between the companies. What would explain
differences between these two companies’ free cash flows?
4. Click on “Historical Prices” and compare the trend in these companies’ stock prices
over the same three year period used to calculate free cash flows
With the wide range of EOC materials, the book
can be adapted to many different levels.—Joshua
Herbold, University of Montana
Earnings Management—Provide challenging
earnings management situations where students analyze the implications of their
accounting decisions on a company’s earnings.
▲
Written Communication—Provide the opportunity to
not only apply analysis and judgment skills but also
to express information or persuade by means of a
writing assignment.
Written Communication
AP4–7 Consider the following independent situations:
1. John Smith is the petty cash custodian. John approves all requests for payment out
of the $200 fund, which is replenished at the end of each month. At the end of each
month, John submits a list of all accounts and amounts to be charged, and a check
is written to him for the total amount. John is the only person ever to tally the fund.
AP5–8 Ernie Upshaw is the supervising manager of Sleep Tight Bedding. At the end
of the year, the company’s accounting manager provides Ernie with the following
information, before any adjusting entries.
Accounts receivable
Estimated percent uncollectible
Allowance for uncollectible accounts
Operating income
$500,000
9%
$20,000 (debit)
$320,000
In the previous year, Sleep Tight Bedding reported operating income (after adjusting
This is a wonderful and innovative book that covers the basics and really makes a serious
effort to bring accounting alive.—S. A. Marino, SUNY/Westchester Community College
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ONLINE LEARNING OPPORTUNITIES THAT
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This text promises to have almost all I have wished for. It uses a conversational style, a
decision-maker perspective, an online “Learning Zone” that works, and author-written
exercises and problems. The content is also organized in a more efficient
and effective manner. —Amy Santos, Manatee Community College
Today’s students are every bit as comfortable using a Web browser as they are reading
a printed book. That’s why we offer an Online Learning Center (OLC) that follows
Financial Accounting chapter-by-chapter. It requires no building or maintenance on
your part, and is ready to go the moment you and your students type in the URL. As
your students study, they can access the OLC Web site for such benefits as:
•
•
•
•
•
•
•
Self-grading quizzes
Apple iPod® content, including quizzes and PowerPoints
Student PowerPoint® Tutorials
Alternate exercises and problems
Check figures
Excel templates
QuickBooks templates
A secured Instructor Resource Center stores your essential course materials to save
you prep time before class. The Instructor Center includes:
•
•
•
•
•
•
Instructor’s Resource Manual
Solutions Manual
Instructor PowerPoint® Presentations
Excel template solutions
EZ Test
Sample syllabi
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ACCOMODATE A VARIETY OF LEARNING STYLES
How Can My Students Use the Web to Complete Their Homework?
MCGRAW-HILL’S HOMEWORK MANAGER®
system is a Web-based supplement that duplicates problem
structures directly from
the end-of-chapter
material in your textbook, using algorithms
to provide a limitless supply of online selfgraded assignments that can be used for
student practice, homework, or testing.
Each assignment has a unique solution. Say
goodbye to cheating in your classroom; say
hello to the power and flexibility you’ve been
waiting for in creating assignments. Exercises,
Brief Exercises, and Problems are available
with Homework Manager.
Text is easy to read (high on readability), has all the key supplements (author-prepared),
good overall coverage with plenty of well thought out examples, and has essential
online support like Homework Manager. —Thomas Brady, University of Dayton
A relevant, readable new addition to Financial Accounting
texts.—Kay C. Carnes, Gonzaga University
MCGRAW-HILL’S HOMEWORK MANAGER PLUS™
is an extension of McGraw-Hill’s popular Homework Manager system. With
Homework Manager Plus you get all of the power of Homework Manager
plus an integrated online version of the text. Students simply receive one
single access code which provides access to all of the resources available through Homework
Manager Plus. When students find themselves needing to reference the textbook in order to
complete their homework, now they can simply click on hints and link directly to the most
relevant materials associated with the problem or exercise they are working on.
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AUTHOR-WRITTEN SUPPLEMENTS
INSTRUCTOR’S CD-ROM
ISBN-13: 9780073306797 (ISBN-10:
0073306797)
This all-in-one resource contains
the Instructor’s Resource Manual,
Solutions Manual, Testbank Word
files, Computerized Testbank, and
PowerPoint® slides.
The textbook is well organized and noticeably
written by individuals who have an
excellent understanding of accounting,
Excellent introductory textbook. It covers
the accounting profession, and the issues
the essential material in an interesting
confronting the accounting profession. A
and engaging manner. It fits well with
Spiceland et al.’s intermediate
text.—Rodney Smith, California State University–
large number of supplements for students and
instructors are available, including high-tech
supplements.—Richard A. Moellenberndt, Washburn
Long Beach
University
TESTBANK
INSTRUCTOR’S RESOURCE MANUAL
This manual provides for each chapter: (a) a chapter overview; (b) a comprehensive lecture outline;
(c) a variety of suggested class activities (real world,
ethics, annual report, professional development activities including research, analysis, communication
and judgment, and others); and (d) an assignment
chart indicating topic, learning objective, and estimated completion time for every question, exercise,
problem, and case.
SOLUTIONS MANUAL
The Solutions Manual includes detailed solutions
for every question, exercise, problem, and case in
the text.
Your presentations have covered many
of the learning styles of the different
students. You have certainly reached
“outside the box” and created a superior
accounting text.—Marjorie Ashton, Truckee
Written by the authors, this comprehensive Testbank
contains over 1,800 problems and true/false, matching, multiple-choice, problems, and essay questions.
COMPUTERIZED TESTBANK WITH
ALGORITHMIC PROBLEM GENERATOR
ISBN-13: 9780077274191 (ISBN-10: 0077274199)
The computerized Testbank with an algorithmic
problem generator enables instructors to create similarly structured problems with different values, allowing every student to be assigned a unique quiz or
test. The user-friendly interface allows faculty to easily create different versions of the same test, change
the answer order, edit or add questions, and even
conduct online testing.
This is an excellent text for the beginning
accounting faculty instructor, intermediate or
advanced.—Linda Bressler, University of Houston
Meadows Community College
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TO ENSURE QUALITY AND CONSISTENCY
AUDIO-NARRATED SLIDES
The Audio-Narrated Slides include an accompanying audio lecture with notes and are available on
the Online Learning Center (OLC). Separate sets of
PowerPoints® are available for instructors and students.
McGraw-Hill’s Homework Manager
system is a Web-based supplement
that duplicates problem structures directly from the
end-of-chapter material in Financial Accounting, using algorithms as needed to provide a limitless supply of online self-graded practice for students, or
assignments and tests with unique versions of every
problem. Assignments are graded automatically, with
the results stored in your private gradebook. Detailed
results let you see at a glance how each student does
on an assignment or an individual problem—you can
even see how many tries it took them to solve it! Students can use McGraw-Hill’s Homework Manager
system on a schedule that’s convenient to them, receiving guided feedback every step of the way.
Additional Resources for Your Students
STUDY GUIDE
Study Guide
for use with
Prepared by
Marianne James
ISBN-13: 9780073306711 (ISBN-10:
0073306711)
The Study Guide, written by Marianne James, provides chapter summaries, detailed illustrations, and a
wide variety of self-study questions,
exercises, and multiple-choice problems (with solutions).
WORKING PAPERS
Working Papers
for use with
ISBN-13: 9780073306704 (ISBN-10:
0073306703)
Working Papers provide students
with formatted templates to aid
them in doing homework assignments.
EXCEL TEMPLATES
Selected end-of-chapter exercises and problems, marked in the text with an icon, can
be solved using these Microsoft Excel templates, located on the OLC.
ALTERNATE EXERCISES AND PROBLEMS
This online manual includes additional exercises
and problems for each chapter in the text. Available
on the OLC.
QUICKBOOKS TEMPLATES
QuickBooks Templates are available for selected
problems in the end-of-chapter material for
Financial Accounting. As the premier accounting software in use today, students will get a head
start on learning how accounting is done in the real
world!
QB
This book has the largest quantity of exercises and problems of any text that I’ve
reviewed. I like having lots of choices in assignments and I think it is very important for students to
work incrementally on some of the more difficult concepts. So I often start with brief exercises, then
exercises, followed by problems and cases. I usually don’t have such an impressive quantity from which
to select.—Kathleen M. Metcalf, Muscatine Community College
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THE TECHNOLOGY INSTRUCTORS NEED
ONLINE COURSE MANAGEMENT
No matter what online course management system you use (WebCT, BlackBoard, or
eCollege), we have a course content ePack available for Financial Accounting. Our new
ePacks are specifically designed to make it easy for students to navigate and access
content online. They are easier than ever to install on the latest version of the course
management system available today.
Don’t forget that you can count on the highest level of service from McGraw-Hill. Our
online course management specialists are ready to assist you with your online course
needs. They provide training and will answer any questions you have throughout the
life of your adoption. So try our new ePack for Financial Accounting and make online
course content delivery easy and fun.
PAGEOUT: MCGRAW-HILL’S COURSE
MANAGEMENT SYSTEM
PageOut is the easiest way to create a Web site for your
accounting course. There is no need for HTML coding,
graphic design, or a thick how-to book. Just fill in a series
of boxes with simple English and click on one of our
professional designs. In no time, your course is online
with a Web site that contains your syllabus! Should you
need assistance in preparing your Web site, we can help.
Our team of product specialists is ready to take your
course materials and build a custom Web site to your specifications. You simply need
to call a McGraw-Hill/Irwin PageOut specialist to start the process. To learn more,
please visit www.pageout.net and see “PageOut Service” below.
Best of all, PageOut is free when you adopt Financial Accounting!
PageOut Service
Our team of product specialists is happy to help you design your own course Web site.
Just call 1-800-634-3963, press 0, and ask to speak with a PageOut specialist. You will
be asked to send in your course materials and then participate in a brief telephone
consultation. Once we have your information, we build your Web site for you from
scratch.
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AND LEARNING SOLUTIONS STUDENTS REQUIRE
QUICK REFERENCE TO CODES AND ICONS
QB
Lecture
Presentations
available for
download to
your iPod,
Zune, or MP3
device (audio
and visual
depending on
your device)
Multiple
Choice quizzes
available for
download to
your iPod,
Zune, or MP3
(depending on
your device)
x
e cel
Go to
www.mhhe.com/
succeed Excel
and QuickBooks
templates allow
students to practice
accounting like a
real professional.
Designated exercises,
problems, and cases
can be solved with
these templates.
Try a New e-Book Option!
COURSESMART
CourseSmart is a new way to find and
buy eTextbooks. At CouseSmart you can
can save up to 50 percent off the cost of a
printed textbook, reduce your impact on the
environment, and gain access to powerful Web tools for learning. CourseSmart has
the largest selection of eTextbooks available anywhere, offering thousands of the most
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CourseSmart eTextbooks are available in one standard online reader with full text
search, notes and highlighting, and email tools for sharing notes between classmates.
MCGRAW-HILL/IRWIN CUSTOMER CARE CONTACT INFORMATION
At McGraw-Hill/Irwin, we understand that getting the most from new technology can be
challenging. That’s why our services don’t stop after you purchase our product. You can e-mail
our Product Specialists 24 hours a day, get product training online, or search our knowledge
bank of Frequently Asked Questions on our support Web site. For all Customer Support call
(800) 331-5094, e-mail [email protected], or visit www.mhhe.com/support. One
of our Technical Support Analysts will be able to assist you in a timely fashion.
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A HEARTFELT THANKS TO THE MANY VOICES
The version of Financial Accounting you are reading
would not be the same book without the valuable
suggestions, keen insights, and constructive criticisms of the list of reviewers below. Each professor
listed here contributed in substantive ways to the
organization of chapters, coverage of topics, and selective use of pedagogy. We are grateful to them for
taking the time to read each chapter and offer their
insights:
James J. Aitken, Central Michigan University
Christie P. Anderson, Whitworth University
Marjorie Ashton, Truckee Meadows Community College
Steven Ault, Montana State University–Bozeman
Tim Baker, California State University–Fresno
Joyce Barden, Devry University–Phoenix
Deborah F. Beard, Southeast Missouri State University
Judy Benish, Fox Valley Tech College
Joseph Berlinski, Prairie State College
Eddy Birrer, Gonzaga University
Jack Borke, University of Wisconsin–Platteville
Lisa N. Bostick, The University of Tampa
Bruce Bradford, Fairfield University
Thomas Brady, University of Dayton
Linda Bressler, University of Houston–Downtown
Madeline Brogan, North Harris College
Carol Brown, Oregon State University
Helen Brubeck, San Jose State University
R. Eugene Bryson, University of Alabama–Huntsville
Charles I. Bunn, Wake Tech Community College
Ron Burrows, University of Dayton
Thane Butt, Champlain College
Sandra Byrd, Missouri State University
Kay C. Carnes, Gonzaga University
Bea Bih-Horng Chiang, The College of New Jersey
Cal Christian, East Carolina University
John Coulter, Western New England College
Sue Cullers, Tarleton State University
Kreag Danvers, Clarion University of PA
Peggy Dejong, Kirkwood Community College
Laura Delaune, Louisiana State University–Baton
Rouge
Shannon Donovan, Bridgewater State College
Allan Drebin, Northwestern University
Ahmed Ebrahim, State University of NY–New Paltz
Thomas Finnegan, University of Illinois–Champaign
Linda Flaming, Monmouth University
Martha Lou Fowler, Missouri Western State University
Tom Fuhrmann, Missouri Western State University
Mohamed Gaber, State University of New York–
Plattsburgh
Rena Galloway, State Fair Community College
Margaret Garnsey, Siena College
David L. Gilbertson, Western Washington University
Lisa Gillespie, Loyola University–Chicago
Ruth Goran, Northeastern Illinois Univetsity
Jeffry Haber, Iona College–New Rochelle
Heidi Hansel, Kirkwood Community College
Sheldon Hanson, Chippewa Valley Tech College
Al Hartgraves, Emory University
Bob Hartman, University of Iowa–Iowa City
K.D. Hatheway-Dial, University of Idaho
John Hathorn, Metro State College of Denver
Byron K. Henry, Howard University
Joshua Herbold, University of Montana
Margaret Hicks, Howard University
Mary Hollars, Vincennes University
Sharon Hoover-Dice, Clinton Community College
Steven Hornik, University of Central Florida
Marsha Huber, Otterbein College
David Hurtt, Baylor University
Laura Ilcisin, University of Nebraska–Omaha
Paula Irwin, Muhlenberg College
Marianne James, California State University–Los Angeles
Raymond Johnson, Guilford College
Melissa Jordan, College of Dupage
David Juriga, St. Louis Community College–Forest
Park
Dennis L. Kovach, Community College of Allegheny
County
Steven J. LaFave, Augsburg College
Phillip D. Landers, Pennsylvania College of Technology
Douglas A. Larson, Salem State College
Laurie Larson-Gardner, Valencia Community
College East
Daniel Law, Gonzaga University
Suzanne Lay, Mesa State College
Christy Lefevers-Land, Catawba Valley Community
College
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WHO SHAPED THIS BOOK
Joseph LiPari, Montclair State University
Chao-Shin Liu, University of Notre Dame
Mostafa Maksy, Northeastern Illinois University
S. A. Marino, SUNY/Westchester Community College
Dawn Massey, Fairfield University
Joyce Matthews, Central New Mexico Community
College
Mark McCarthy, East Carolina University
Robert W. McGee, Barry University
Chris McNamara, Finger Lakes Community College
Kathleen M. Metcalf, Muscatine Community College
Herbert L. Meyer, Scott Community College–Davenport
Jean Meyer, Loyola University
Pam Meyer, University of Louisiana–Lafayette
Laurel Bond Mitchell, University of Redlands
Richard A. Moellenberndt, Washburn University
Dennis P. Moore, Worcester State College
Tommy Moores, University of Nevada–Las Vegas
Ron O’Brien, Fayetteville Tech Community College
George Pate, Robeson Community College
Keith Patterson, Brigham Young University–Idaho
Susanna Pendergast, Western Illinois University
Jan Pitera, Broome Community College
John Plouffe, California State University–Los Angeles
Alan Ransom, Cypress College
Laura Rickett, Kent State University
John A. Rude, Bloomsburg University of PA
Amy Santos, Manatee Community College–Bradenton
Dick Schroeder, University North Carolina–Charlotte
Ann E. Selk, University of Wisconsin–Green Bay
Seleshi Sisaye, Duquesne University
Rodney Smith, California State University–Long Beach
Nancy L. Snow, University of Toledo
Victor Stanton, University of California–Berkeley
Gracelyn Stuart, Palm Beach Community College
John J. Surdick, Xavier University
G A Swanson, Tennessee Tech University
Aida Sy, University of Bridgeport
Christine Tan, Baruch College
Steve Teeter, Utah Valley State College
Peter Theuri, Northern Kentucky University
Ada Till, Prairie View A&M University
Michael Tyler, Barry University
Joan Van Hise, Fairfield University
Marcia R. Veit, University of Central Florida
Stacy R. Wade, Western Kentucky University
Susan Wessels, Meredith College
Peter Woodlock, Youngstown State University
Gregg S. Woodruff, Western Illinois University
Christian Wurst, Temple University–Philadelphia
Thomas M. Young, Tomball College
Benny Zachry, Nicholls State University
Lin Zheng, Georgia College and State University
Robert Zwicker, Pace University
FOCUS GROUP ATTENDEES
Reviewers’ conferences give our authors a valuable
opportunity to interact with textbook users face to
face, hearing firsthand their successes and difficulties in the classroom. That feedback was particularly
valuable in crafting the first edition of Financial
Accounting, and the Spiceland team extends special
thanks to all those who participated:
Marjorie Ashton, Truckee Meadows Community College
Glenellyn Barty, Northern Kentucky University
Lisa N. Bostick, University of Tampa
Allan Drebin, Northwestern University
Daniel Gibbons, Waubonsee Community College
Lisa Gillespie, Loyola University–Chicago
Janet Grange, Chicago State University
David Juriga, Saint Louis Community College
Christine Kloezeman, Glendale Community College
Herbert L. Meyer, Scott Community College
Lisa Murawa, Mott Community College
Barbara Nyden, Missouri State University–West Plains
Nancy L. Snow, University of Toledo
Aida Sy, University of Bridgeport
Peter Theuri, Northern Kentucky University
Jinhee Trone, Santa Ana College
Gideon Wray, Pennsylvania College of Technology
Christian Wurst, Temple University–Philadelphia
Benny Zachry, Nicholls State University
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ACKNOWLEDGMENTS
Many talented people contributed to the creation of this first edition, and we
would like to thank them for their valuable contributions. The keen editorial
instincts of Elisa Adams helped shape the first draft of manuscript for Financial Accounting. Mark McCarthy of East Carolina University did a wonderful
job accuracy checking the final manuscript; we thank him for his speedy and
helpful comments. We appreciate Teressa Farough’s thorough accuracy check
of the pageproof. Carol Yacht and Jack Terry contributed the QuickBooks templates and Excel templates (respectively) that accompany the end-of-chapter
material. We appreciate the very helpful Lori Cody from The Buckle, Inc., and
Jill Swansegar from American Eagle Outfitters, Inc., for helping us get permission to use their companies’ Annual Reports in the appendices. Many thanks
to the talented staff at InfoLabs for their assistance with the narrated PowerPoints® and Working Papers that accompany the book. We also appreciate
Marianne James’s (California State University, Los Angeles) excellent work
preparing the Study Guide for this first edition.
We appreciate the excellent Homework Manager accuracy checking work
completed by Mark McCarthy, East Carolina University; Angela Sandberg,
Jacksonville State University; Patty Lobingier, Virginia Polytechnic Institute; Anna Lusher, Slippery Rock University; Beth Woods, Accuracy Counts!;
Laura Rickett, Kent State University; Carol Brown, Oregon State University;
and Teressa Farough.
We also appreciate the expert attention given to this project by the staff
at McGraw-Hill/Irwin, especially Stewart Mattson, Editorial Director; Tim
Vertovec, Publisher; Daryl Horrocks, Developmental Editor; Sankha Basu,
Executive Marketing Manager; Pat Frederickson, Project Manager; Kerry
Bowler, Media Product Manager; Laurie Entringer and Ellen Pettengell,
Designers; and Gina Hangos, Production Supervisor.
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Rev. Confirming Pages
ASSURANCE OF ACCURACY
Dear Colleague,
As textbook authors, and more importantly, as instructors of financial
accounting, we recognize the great importance placed on accuracy—not only
in the book you are now holding, but in the supplements as well. With this in
mind, we have taken the following steps to ensure that Financial Accounting
is error-free:
1. We received detailed feedback from over 170 instructor reviews, starting with first draft manuscript through the final draft submitted to the
publisher. Each review contributed in significant ways to the accuracy of
the content.
2. We personally class-tested the manuscript with our students before it was
published.
3. Each of us wrote, reviewed, and carefully checked all of the end-of-chapter
material.
4. A developmental writer went through each sentence to ensure that our
language was as clear as possible.
5. Multiple accuracy checkers reviewed each chapter and its accompanying end-of-chapter material—once when the final manuscript was submitted to the publisher, and again when our final formatted pages were
completed.
6. A copyeditor checked the grammar of the final manuscript.
7. A proofreader reviewed each page to ensure no errors remained.
8. Our Solutions Manual and Testbank were created by the authors and
reviewed by multiple independent accuracy checkers.
Given the steps taken above, we have the utmost confidence that you and
your students will have a great experience using Financial Accounting.
Sincerely,
David Spiceland
Wayne Thomas
Don Herrmann
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