Interpreting and Analyzing Financial Statements / Edition 6

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Overview

This text helps students analyze real company financial statement information. Each activity in the book concentrates on only one aspect of the analysis and uses data from well-known corporations to pique students' interest and add relevancy.

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Editorial Reviews

Booknews
Designed as a supplement to financial accounting textbooks, this guide provides a series of preliminary activities to prepare students before they do a comprehensive financial statement analysis. Using data from well-known corporations, each activity concentrates on a single aspect of the overall analysis. The guide includes real-world and Internet activities (but lacks a subject index). The author, a CPA, runs a consulting company that provides presentations on accounting, leadership training, and overseas travel; she also teaches at Southwestern College of Kansas. Annotation c. Book News, Inc., Portland, OR (booknews.com)
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Product Details

  • ISBN-13: 9780132746243
  • Publisher: Prentice Hall
  • Publication date: 7/20/2012
  • Edition description: New Edition
  • Edition number: 6
  • Pages: 360
  • Sales rank: 125,664
  • Product dimensions: 8.40 (w) x 10.70 (h) x 0.80 (d)

Meet the Author

Karen P. Schoenebeck, MBA, CPA, is a Visiting Professor of Accounting at the Stillman School of Business, Seton Hall University, South Orange, New Jersey. She received her MBA from the University of Minnesota and then worked in public accounting while located in Wisconsin, Kansas, and California. Using her practical experience, she brings the real-world relevance of accounting concepts into the classroom. For over ten years she has been developing the financial statement analysis approach presented in this book, challenging both graduate and undergraduate students. She is also president and founder of Two-Paved Roads, a consulting firm, served as Director of the MBA program at Southwestern College in Kansas, presents at national accounting conferences on a regular basis, and has served on the national board of directors for various accounting organizations for over ten years. In addition, Karen is an avid traveler, leading educational tours to Europe and Southeast Asia. She can be reached at kaliforniakaren@gmail.com .

Mark P. Holtzman, PhD, CPA is Associate Professor of Accounting at the Stillman School of Business, Seton Hall University, South Orange, New Jersey. After receiving a bachelor’s degree in business administration at Hofstra University, he began his accounting career in the New York office of Deloitte & Touche. He later earned a PhD in accounting from The University of Texas at Austin. Dr. Holtzman has published articles in Journal of Accountancy, CPA Journal, Research in Accounting Regulation, Advances in Accounting, Strategic Finance, and Accounting Historian’s Journal. He is a member of the American Accounting Association, the American Institute of Certified Public Accountants, and the Financial Executives Institute. He is also President and founder of a private parochial elementary school for 100 children in Passaic, New Jersey. In his spare time, he enjoys studying Talmud and hiking with his family. He can be reached at mark.holtzman@shu.edu.

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Read an Excerpt

PREFACE:

PREFACE

While this book can be used to supplement any financial accounting text, the activities have been designed to accompany Financial Accounting, 4th edition by Walter T. Harrison, Jr. and Charles T. Horngren (Prentice Hall, 2001).

WHY THESE ACTIVITIES WERE DEVELOPED
When I first started assigning a comprehensive financial statement analysis as a capstone project, it became evident many students didn't know where to begin. They were overwhelmed by all of the numbers and felt frustrated. As a result, this series of preliminary activities was developed to prepare students for the capstone project. Each activity concentrates on only one aspect of financial statement analysis. After completing the preliminary activities, students feel confident in their strategies and ability to successfully complete a comprehensive financial statement analysis.

USING DATA FROM WELL-KNOWN CORPORATIONS
These activities use financial data from companies familiar to students. The actual numbers make the class relevant and more interesting to students. Because students are already familiar with the companies, they more easily grasp the material and remember the concepts.

FOCUS IS ON INTERPRETING AND ANALYZING
Most amounts are provided and calculations are kept to a minimum so students can focus their time and attention on interpretation and analysis. Fifteen minutes on average is required for completion of each activity.

INTERNET AND OTHER TYPES OF RESEARCH
There is at least one Internet activity for each chapter. Other research activities require reading The Wall Street Journal,calling a local bank, or utilizing library resources that are available. The final chapter contains a corporate analysis that requires in-depth research of a company. These research activities inform students of the many resources available and utilize their analyzing skills.

FOUR-YEAR COMPARISON
Financial statements are introduced using four years of comparative information. Each line item is studied and the student develops an overall strategy to analyze the financial statement. Questions lead to increased understanding and highlight important trends.

RATIO ANALYSIS
Activities point out the significant role ratios have in analyzing financial statements. Students acquire a "feel" for the expected range and magnitude of the ratios and identify whether a high or low ratio is usually preferred. Commonly used ratios are studied.

TREND ANALYSIS
Trend analysis is used to evaluate both the income statement and the balance sheet. Emphasis is placed on comparing the rate of increase or decrease of various account classifications within each financial statement.

COMMON-SIZE STATEMENT ANALYSIS
Common-size statements are used to compare companies of different size.

ETHICAL ISSUES
Ethical issues are incorporated into a number of the activities.

RANGE AND MAGNITUDE OF AMOUNTS
Companies are carefully selected so students get a "feel" for the range and magnitude of expected amounts and ratios in the corporate world.

REVIEW
Review exercises titled "Test Your Understanding" are located at the end of each chapter. In addition, Chapter 6 provides a thorough review of each balance sheet account, and Chapter 7 provides a comprehensive review of all the financial statements.

CLASS FORMAT
These activities can be utilized as individual homework assignments, small group discussions in class, a review, or a combination of all three. Whichever approach is used, these assignments result in thorough understanding and lively classroom discussion.

CORPORATE ANALYSIS
The final project requires students to research, analyze, and prepare a comprehensive written report on the public corporation of their choice. To complete the project, students must obtain a copy of the corporate financial statements and utilize a variety of resources. Because the company is the student's choice, interest is high and a quality product results. This project has several parts. The parts may be assigned throughout the semester, or as a capstone project at the end of the semester.

TO THE INSTRUCTOR...

This book contains a series of activities designed to help students acquire the necessary skills to interpret, analyze, and research financial statement information. A user-oriented approach is maintained throughout the book, utilizing financial information from companies familiar to students. For successful completion of the problem materials, both a conceptual understanding and mathematical ,computations are required. Activities employ written exercises, Internet activities, and other research opportunities to strengthen understanding. Ethical issues are raised. With over 90 activities to choose from, instructors can select activities appropriate to their individual needs.

Chapter 1 is designed to accompany the first few weeks of a semester course. Basic accounting concepts are reinforced. An early introduction of ratios, trend analysis, and common-size statements enhance understanding of the relationship between amounts on the balance sheet and the income statement throughout the course. The analysis activities require no previous introduction. Allow 5 to 15 minutes to complete each activity.

Chapters 2, 3, and 4 are designed as a step-by-step guide for analyzing each of the three major financial statements. Questions lead to increased understanding and highlight important trends. These activities can be assigned anytime after the first few weeks of a semester course. They can be used concurrently with the financial statement coverage in the text, after the statement coverage, as a review to reinforce understanding, or simply as a stand-alone assignment at any point throughout the semester. The activities in these chapters start basic and progress to more complex. Allow 15 to 30 minutes for each activity.

Chapter 5 introduces industry norms for the ratios and reviews thirteen commonly used ratios. Ratios from well-known corporations provide the foundation for activity questions. Allow 5 to 10 minutes to complete each activity.

Chapter 6 is designed to be used throughout the semester as the topics arise.

  • Activities 63 through 72 present specific balance sheet account information followed by a series of questions that test for understanding. A thorough understanding of the material is required for successful completion. These activities are appropriate for individual homework assignments, quizzes, small group discussion in class, or as review materials. Allow 5 to 15 minutes for each activity.
  • Activities 73-79 examine the stock and bond markets using a variety of research activities that utilize The Wall Street Journal, the Internet, and other business resources. These activities enhance the coverage of liabilities and stockholders' equity. Allow 15 to 30 minutes to complete each activity.

Chapter 7 provides a comprehensive review of all three major financial statements. The activities review understanding of transaction analysis, finding specific account information, interpreting financial information, and analyzing all three major financial statements.

Chapter 8 is a Corporate Analysis project with four parts. It can be assigned as a capstone project at the end of the semester, or as a series of assignments spread throughout the semester. This final project requires students to research, analyze, and prepare a comprehensive, written report on the public corporation of their choice. This project provides an opportunity to apply and reinforce learning from previous activities and from the accounting course.

Have fun with these assignments. Bring real-world numbers into the classroom in an organized series of assignments. My students enjoy these assignments and the learning that results. I hope you do too. Please feel free to contact me with comments and questions regarding these activities. My e-mail address is schoeneb@twsuvm.uc.twsu.edu.

Karen Schoenebeck, author

TO THE STUDENT...

WARNING!!!
MANY OF THE QUESTIONS CONTAINED IN THIS BOOK REQUIRE THOUGHT!

You are about to embark on a journey into the world of business. Some of you read The Wall Street Journal on a regular basis, while others have not yet been introduced to assets and liabilities. This series of activities is designed to introduce you to the financial information for a variety of familiar companies and financial statement analysis. After completing these activities you should feel confident in your ability to research and understand any set of corporate financial statements. Below is a summary of each chapter followed by a question answered in the chapter material.

Chapter 1 introduces the range and magnitude of amounts reported on financial statements of well-known companies. Trend analysis and common-size statements are introduced. An understanding is developed for the information provided by ratios and whether an increasing or decreasing trend is usually preferred. For major corporations, are sales usually reported in the range of millions, billions, or trillions?

Chapter 2 introduces strategies for analyzing the balance sheet and then applies those strategies. Classified balance sheets, trend analyses, and common-size statements are prepared and followed by questions that lead you through interpretation to understanding. Does an increase in retained earnings indicate the company issued more stock, purchased more assets, or reported net income?

Chapter 3 introduces strategies for analyzing the income statement and then applies those strategies. Multi-step income statements, trend analyses, and common-size statements are prepared and followed by questions that lead you through interpretation to understanding. If sales increase by 10%, would you also expect expenses to increase?

Chapter 4 introduces strategies for analyzing the statement of cash flows and then applies those strategies. Operating, investing, and financing activities are identified and analyzed. The primary source of cash for an established company with a strong cash position should be operating, investing, or financing activities?

Chapter 5 reinforces the information provided by various financial ratios and introduces industry norms. Industry average information is reported using which four-digit code?

Chapter 6 reinforces understanding of amounts reported on the financial statements. It also includes activities that examine the stock and bond market, and benchmark current interest rates and the Dow Jones Industrial Average. Research activities require use of The Wall Street Journal, the Internet, and other business publications. For property, plant, and equipment (PPE), is acquisition cost or book value added to calculate total assets?

Chapter 7 provides a comprehensive review of all three major financial statements. The activities review understanding of transaction analysis, finding specific account information, interpreting financial information, and analyzing all three major financial statements. When using LIFO, the most recent (current) inventory costs are reported on which financial statement?

Chapter 8 is a capstone project that includes researching and analyzing a publicly traded corporation of your choice. This provides an opportunity to apply the knowledge learned to a company of personal interest.

ACKNOWLEDGMENTS

I WOULD LIKE TO THANK...

The Prentice Hall staff including Deborah Hoffinan who discovered my materials, encouraged me to submit them for publishing, and continues to support my work; Natacha St. Hill Moore for her past encouragement, patience, and assistance; Kathryn Sheehan for her current encouragement and assistance; and Jane Avery for her endless hours of proofing.

My students who provide continued opportunities for me to learn, and are always ready to give me honest and helpful feedback.

My husband, Dennis, for his support and encouragement; Grant, my son, who assisted with research, math calculations, and typing; and Casey, my son, for just being a neat person.

Karen Schoenebeck, author

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Table of Contents

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

Read More Show Less

Preface

PREFACE:

PREFACE

While this book can be used to supplement any financial accounting text, the activities have been designed to accompany Financial Accounting, 4th edition by Walter T. Harrison, Jr. and Charles T. Horngren (Prentice Hall, 2001).

WHY THESE ACTIVITIES WERE DEVELOPED
When I first started assigning a comprehensive financial statement analysis as a capstone project, it became evident many students didn't know where to begin. They were overwhelmed by all of the numbers and felt frustrated. As a result, this series of preliminary activities was developed to prepare students for the capstone project. Each activity concentrates on only one aspect of financial statement analysis. After completing the preliminary activities, students feel confident in their strategies and ability to successfully complete a comprehensive financial statement analysis.

USING DATA FROM WELL-KNOWN CORPORATIONS
These activities use financial data from companies familiar to students. The actual numbers make the class relevant and more interesting to students. Because students are already familiar with the companies, they more easily grasp the material and remember the concepts.

FOCUS IS ON INTERPRETING AND ANALYZING
Most amounts are provided and calculations are kept to a minimum so students can focus their time and attention on interpretation and analysis. Fifteen minutes on average is required for completion of each activity.

INTERNET AND OTHER TYPES OF RESEARCH
There is at least one Internet activity for each chapter. Other research activities require reading The Wall StreetJournal,calling a local bank, or utilizing library resources that are available. The final chapter contains a corporate analysis that requires in-depth research of a company. These research activities inform students of the many resources available and utilize their analyzing skills.

FOUR-YEAR COMPARISON
Financial statements are introduced using four years of comparative information. Each line item is studied and the student develops an overall strategy to analyze the financial statement. Questions lead to increased understanding and highlight important trends.

RATIO ANALYSIS
Activities point out the significant role ratios have in analyzing financial statements. Students acquire a "feel" for the expected range and magnitude of the ratios and identify whether a high or low ratio is usually preferred. Commonly used ratios are studied.

TREND ANALYSIS
Trend analysis is used to evaluate both the income statement and the balance sheet. Emphasis is placed on comparing the rate of increase or decrease of various account classifications within each financial statement.

COMMON-SIZE STATEMENT ANALYSIS
Common-size statements are used to compare companies of different size.

ETHICAL ISSUES
Ethical issues are incorporated into a number of the activities.

RANGE AND MAGNITUDE OF AMOUNTS
Companies are carefully selected so students get a "feel" for the range and magnitude of expected amounts and ratios in the corporate world.

REVIEW
Review exercises titled "Test Your Understanding" are located at the end of each chapter. In addition, Chapter 6 provides a thorough review of each balance sheet account, and Chapter 7 provides a comprehensive review of all the financial statements.

CLASS FORMAT
These activities can be utilized as individual homework assignments, small group discussions in class, a review, or a combination of all three. Whichever approach is used, these assignments result in thorough understanding and lively classroom discussion.

CORPORATE ANALYSIS
The final project requires students to research, analyze, and prepare a comprehensive written report on the public corporation of their choice. To complete the project, students must obtain a copy of the corporate financial statements and utilize a variety of resources. Because the company is the student's choice, interest is high and a quality product results. This project has several parts. The parts may be assigned throughout the semester, or as a capstone project at the end of the semester.

TO THE INSTRUCTOR...

This book contains a series of activities designed to help students acquire the necessary skills to interpret, analyze, and research financial statement information. A user-oriented approach is maintained throughout the book, utilizing financial information from companies familiar to students. For successful completion of the problem materials, both a conceptual understanding and mathematical ,computations are required. Activities employ written exercises, Internet activities, and other research opportunities to strengthen understanding. Ethical issues are raised. With over 90 activities to choose from, instructors can select activities appropriate to their individual needs.

Chapter 1 is designed to accompany the first few weeks of a semester course. Basic accounting concepts are reinforced. An early introduction of ratios, trend analysis, and common-size statements enhance understanding of the relationship between amounts on the balance sheet and the income statement throughout the course. The analysis activities require no previous introduction. Allow 5 to 15 minutes to complete each activity.

Chapters 2, 3, and 4 are designed as a step-by-step guide for analyzing each of the three major financial statements. Questions lead to increased understanding and highlight important trends. These activities can be assigned anytime after the first few weeks of a semester course. They can be used concurrently with the financial statement coverage in the text, after the statement coverage, as a review to reinforce understanding, or simply as a stand-alone assignment at any point throughout the semester. The activities in these chapters start basic and progress to more complex. Allow 15 to 30 minutes for each activity.

Chapter 5 introduces industry norms for the ratios and reviews thirteen commonly used ratios. Ratios from well-known corporations provide the foundation for activity questions. Allow 5 to 10 minutes to complete each activity.

Chapter 6 is designed to be used throughout the semester as the topics arise.

  • Activities 63 through 72 present specific balance sheet account information followed by a series of questions that test for understanding. A thorough understanding of the material is required for successful completion. These activities are appropriate for individual homework assignments, quizzes, small group discussion in class, or as review materials. Allow 5 to 15 minutes for each activity.
  • Activities 73-79 examine the stock and bond markets using a variety of research activities that utilize The Wall Street Journal, the Internet, and other business resources. These activities enhance the coverage of liabilities and stockholders' equity. Allow 15 to 30 minutes to complete each activity.

Chapter 7 provides a comprehensive review of all three major financial statements. The activities review understanding of transaction analysis, finding specific account information, interpreting financial information, and analyzing all three major financial statements.

Chapter 8 is a Corporate Analysis project with four parts. It can be assigned as a capstone project at the end of the semester, or as a series of assignments spread throughout the semester. This final project requires students to research, analyze, and prepare a comprehensive, written report on the public corporation of their choice. This project provides an opportunity to apply and reinforce learning from previous activities and from the accounting course.

Have fun with these assignments. Bring real-world numbers into the classroom in an organized series of assignments. My students enjoy these assignments and the learning that results. I hope you do too. Please feel free to contact me with comments and questions regarding these activities. My e-mail address is schoeneb@twsuvm.uc.twsu.edu.

Karen Schoenebeck, author

TO THE STUDENT...

WARNING!!!
MANY OF THE QUESTIONS CONTAINED IN THIS BOOK REQUIRE THOUGHT!

You are about to embark on a journey into the world of business. Some of you read The Wall Street Journal on a regular basis, while others have not yet been introduced to assets and liabilities. This series of activities is designed to introduce you to the financial information for a variety of familiar companies and financial statement analysis. After completing these activities you should feel confident in your ability to research and understand any set of corporate financial statements. Below is a summary of each chapter followed by a question answered in the chapter material.

Chapter 1 introduces the range and magnitude of amounts reported on financial statements of well-known companies. Trend analysis and common-size statements are introduced. An understanding is developed for the information provided by ratios and whether an increasing or decreasing trend is usually preferred. For major corporations, are sales usually reported in the range of millions, billions, or trillions?

Chapter 2 introduces strategies for analyzing the balance sheet and then applies those strategies. Classified balance sheets, trend analyses, and common-size statements are prepared and followed by questions that lead you through interpretation to understanding. Does an increase in retained earnings indicate the company issued more stock, purchased more assets, or reported net income?

Chapter 3 introduces strategies for analyzing the income statement and then applies those strategies. Multi-step income statements, trend analyses, and common-size statements are prepared and followed by questions that lead you through interpretation to understanding. If sales increase by 10%, would you also expect expenses to increase?

Chapter 4 introduces strategies for analyzing the statement of cash flows and then applies those strategies. Operating, investing, and financing activities are identified and analyzed. The primary source of cash for an established company with a strong cash position should be operating, investing, or financing activities?

Chapter 5 reinforces the information provided by various financial ratios and introduces industry norms. Industry average information is reported using which four-digit code?

Chapter 6 reinforces understanding of amounts reported on the financial statements. It also includes activities that examine the stock and bond market, and benchmark current interest rates and the Dow Jones Industrial Average. Research activities require use of The Wall Street Journal, the Internet, and other business publications. For property, plant, and equipment (PPE), is acquisition cost or book value added to calculate total assets?

Chapter 7 provides a comprehensive review of all three major financial statements. The activities review understanding of transaction analysis, finding specific account information, interpreting financial information, and analyzing all three major financial statements. When using LIFO, the most recent (current) inventory costs are reported on which financial statement?

Chapter 8 is a capstone project that includes researching and analyzing a publicly traded corporation of your choice. This provides an opportunity to apply the knowledge learned to a company of personal interest.

ACKNOWLEDGMENTS

I WOULD LIKE TO THANK...

The Prentice Hall staff including Deborah Hoffinan who discovered my materials, encouraged me to submit them for publishing, and continues to support my work; Natacha St. Hill Moore for her past encouragement, patience, and assistance; Kathryn Sheehan for her current encouragement and assistance; and Jane Avery for her endless hours of proofing.

My students who provide continued opportunities for me to learn, and are always ready to give me honest and helpful feedback.

My husband, Dennis, for his support and encouragement; Grant, my son, who assisted with research, math calculations, and typing; and Casey, my son, for just being a neat person.

Karen Schoenebeck, author

Read More Show Less

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