Acct 101

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Chapter 1

Exercise 1.2 pg. 33:

Boeing Company is the largest manufacturer of commercial aircraft in the United States and is a major employer in Seattle, Washington. Explain why each of the following individuals or organizations would be interested in financial information about the company.

a. California Public Employees Retirement System (CPRES)
• Financial information from Boeing could provide CPRES with information like transfers, cash outs, disenrollment, as well as projected enrollments. Also, the information can provide CPRES with a projected year or multiple years of payout. b. China Airlines

• Financial information from Boeing can help China Airlines by helping them to make decisions for future investments, and aid them in determining how dependable Boeing is for funding of new projects, and reliability of delivery of acquisitions. c. Henry James

• Henry can use Boeing’s information to mark trends for Seattle’s economy. He can also use the financial information from Boeing to decide whether or not the company’s financials are good. If the financials are good, the investment into apartments is not as risky than if the company had to make adjustments to staff etc. to balance operations. d. Boeing’s Management

• Boeing’s management can use Boeing’s financial information to help management set goals, evaluate individual and departmental performance, control inventory, gauge shipping and deliver information, and estimate budgets necessary. e. International Aerospace Machinists

• International Aerospace Machinists can use the financial information from Boing to make sure that employee rights are being advocated and supported. They can also use the information to make sure those union contracts are being fulfilled.

Chapter 1

Exercise 1.7 pg. 33:

Match the terms on the left with the descriptions on the right. Each description should only be used once.

I: Financial Accounting – the area of accounting that refers to providing information to support external investments and credit decisions. H: Management Accounting – the area of accounting that refers to providing information to support internal management decisions. B: Financial Reporting – a broad term that describes all information provided to external users, including but not limited to financial statements. F: Financial Statements – statement of financial position (balance sheet), income statement, statement of cash flows. G: General-Purpose Assumption – the fact that the same information is provided to various external users, including investors and creditors. C: Integrity – an important quality of accounting information that allows investors, creditors, management, and other users to rely on the information. E: Internal Control – procedures and processes within an organization that ensure the integrity of accounting information. D: Public Accounting – the segment of the accounting profession that relates to providing audit, tax, and consulting services to clients. A: Bookkeeping – the procedural aspect of accounting that involves keeping detailed records of business transactions, much of which is done today by computers.

Chapter 2

Exercise 2.3 pg. 68:

Mercer Company
Balance Sheet
December 31, 2009

RevenuesExpenses

Cash……………………..$36,300Liabilities:
Accounts Receivable ……$56,700Notes Payable…………………$207,000 Land…………….……….$90,000Accounts Payable……………..$43,800 Building…………………$210,000Total Liability: Office Equipment……….$12,400Owners Equity:

Capital Stock………………….$75,000
Retained Earnings….……….$79,600

Total…………………….$405,400Total…………………………..$405,400

Chapter 2

Exercise 2.13 pg. 70:

Yarnell Company
Income Statement
Period: August 1-31, 2009

Revenues:
Services………………………………………….$15,000
Investment by Stockholders……………………..$5,000...
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