Principles of Accounting
12th Edition
ISBN: 9781133626985
Author: Belverd E. Needles, Marian Powers, Susan V. Crosson
Publisher: Cengage Learning
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Textbook Question
Chapter 1, Problem 10AP
Aqua Swimming Club’s financial statements follow.
REQUIRED
- 1. ACCOUNTING CONNECTION ▶ Explain how Aqua Swimming Club’s four statements relate to each other.
- 2. BUSINESS APPLICATION ▶ Which statements are most closely associated with the goals of liquidity and profitability? Why?
- 3. BUSINESS APPLICATION ▶ If you were the owner of this business, how would you evaluate the company’s performance? Give specific examples.
- 4. ACCOUNTING CONNECTION ▶ If you were a banker considering Aqua Swimming Club for a loan, why might you want the company to be audited by an independent CPA? What would the audit tell you?
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According to concept of accounting, financial or business transaction is recorded:
a ) when cash is received or paid
b) when transaction occurs
c) when profit is computed
D) when balance sheet is prepared
===================================
Which of below users considered as Internal users of accounting information system?
a. Investor
b. Middle management
c. Bank
d. Buyer
==========================
Creditors of a business may want to use the financial statements to:
a. Be sure that after-sales service will continue
b. Be sure of an increasing share of the market
c. Check that the business is making a profit
d. Check that they are likely to be paid when due
Direction: Identify what describes the following statement. Write your answer on the blank before the number.
____________________1. It pertains to the state of one’s personal monetary affairs.
____________________2. It measures the ability to generate earnings from its resources or investments.
____________________3. It measures the ability to generate profit that ensures to pay business expenses and maintain a long-term financial success of the business.
____________________4. It measures the ability of the company to settle its short term debts.
____________________ 5. It measures how the business manage its assets or resources to produce output without wastage.
____________________6. It presents the financial statement amounts as a percentage of a base number.
____________________7. It is used to evaluate a number of issues with an entity, such as its liquidity, efficiency of operations, and profitability.
____________________8. These users of financial information are…
For each of the following descriptions choose the correct accounting concept:(a) An economic event is reported so it represents what actually happened.(b) Users find the information in the financial statements helps them to make decisions.(c)The accounting information shows the profit of a business without consideration of what the owner may want to report.(d) Financial statements make sense to business people.(e) Henry is able to confirm the information presented in the financial statements.(f)Très Chic Boutique uses the same accounting methods as other similar boutiques.
accounting concepts:
Neutrality
Faithful Representation
Relevance
Comparability
Understandability
Verifiability
Chapter 1 Solutions
Principles of Accounting
Ch. 1 - What makes accounting a valuable discipline?Ch. 1 - Prob. 2DQCh. 1 - Prob. 3DQCh. 1 - How are expenses and withdrawals similar, and how...Ch. 1 - How do generally accepted accounting principles...Ch. 1 - Why do managers in governmental and not-for-profit...Ch. 1 - Prob. 1SECh. 1 - Match the descriptions that follow with the...Ch. 1 - Determine the amount missing from each accounting...Ch. 1 - Use the accounting equation to answer each...
Ch. 1 - Use the accounting equation to answer each...Ch. 1 - Prob. 6SECh. 1 - Use the following accounts and balances to prepare...Ch. 1 - Randall Company engaged in activities during the...Ch. 1 - Prob. 9SECh. 1 - Prob. 10SECh. 1 - Prob. 1EACh. 1 - Financial accounting uses money measures to gauge...Ch. 1 - You have been asked to compare the sales and...Ch. 1 - Use the accounting equation to answer each...Ch. 1 - Daiichi Companys total assets and liabilities at...Ch. 1 - 1. Indicate whether each of the following accounts...Ch. 1 - Listed in random order are some of Oxford Services...Ch. 1 - Dukakis Company had the following accounts and...Ch. 1 - Prob. 9EACh. 1 - Prob. 10EACh. 1 - Complete the financial statements that follow by...Ch. 1 - Prob. 12EACh. 1 - Match the terms that follow with the appropriate...Ch. 1 - Prob. 14EACh. 1 - Prob. 15EACh. 1 - Prob. 1PCh. 1 - The following three independent sets of financial...Ch. 1 - Fuel Designs financial accounts follow. The...Ch. 1 - The accounts of Frequent Ad, an agency that...Ch. 1 - Athena Riding Clubs financial statements follow.Ch. 1 - A list of financial statement items follows....Ch. 1 - Three independent sets of financial statements...Ch. 1 - Prob. 8APCh. 1 - Prob. 9APCh. 1 - Aqua Swimming Clubs financial statements follow....Ch. 1 - Costco Wholesale Corporation is Americas largest...Ch. 1 - Prob. 2CCh. 1 - Prob. 3CCh. 1 - Prob. 4CCh. 1 - Refer to the CVS annual report and the financial...
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