1 Accounting in Action 1-1
1.1 Accounting Activities and Users 1-3
1.2 The Building Blocks of Accounting 1-7
1.3 The Accounting Equation 1-12
1.4 Analyzing Business Transactions 1-14
1.5 Financial Statements 1-22

2 The Recording Process 2-1
2.1 Accounts, Debits, and Credits 2-2
2.2 The Journal 2-8
2.3 The Ledger and Posting 2-11
2.4 The Trial Balance 2-22

3 Adjusting the Accounts 3-1
3.1 Accrual-Basis Accounting and Adjusting Entries 3-2
3.2 Adjusting Entries for Deferrals 3-7
3.3 Adjusting Entries for Accruals 3-14
3.4 Adjusted Trial Balance and Financial Statements 3-22

4 Completing the Accounting Cycleg 4-1
4.1 The Worksheet 4-3
4.2 Closing the Books 4-13
4.3 The Accounting Cycle and Correcting Entries 4-20
4.4 Classified Statement of Financial Position 4-24

5 Accounting for Merchandise Operations 5-1
5.1 Merchandising Operations and Inventory Systems 5-3
5.2 Recording Purchases Under a Perpetual System 5-7
5.3 Recording Sales Under a Perpetual System 5-11
5.4 The Accounting Cycle for a Merchandising Company 5-16
5.5 Financial Statements for a Merchandiser 5-19

6 Inventories 6-1
6.1 Classifying and Determining Inventory 6-2
6.2 Inventory Methods and Financial Effects 6-7
6.3 Effects of Inventory Errors 6-14
6.4 Inventory Statement Presentation and Analysis 6-16

7 Fraud, Internal Control, and Cash 7-1
7.1 Fraud and Internal Control 7-2
7.2 Cash Controls 7-11
7.3 Control Features of a Bank Account 7-19
7.4 Reporting Cash 7-27

8 Accounting for Receivables 8-1
8.1 Recognition of Accounts Receivable 8-2
8.2 Valuation and Disposition of Accounts Receivable 8-5
8.3 Notes Receivable 8-15
8.4 Presentation and Analysis 8-20

9 Plant Assets, Natural Resources, and Intangible Assets 9-1
9.1 Plant Asset Expenditures 9-2
9.2 Depreciation Methods 9-7
9.3 Plant Asset Disposals 9-16
9.4 Natural Resources and Intangible Assets 9-19
9.5 Statement Presentation and Analysis 9-25

10 Current Liabilities 10-1
10.1 Accounting for Current Liabilities 10-2
10.2 Reporting and Analyzing Current Liabilities 10-8

11 Non-Current Liabilities 11-1
11.1 Overview of Bonds 11-2
11.2 Accounting for Bond Transactions 11-7
11.3 Accounting for Non-Current Liabilities 11-13
11.4 Reporting and Analyzing Non-Current Liabilities 11-16

12 Corporations: Organization, Share Transactions, and Equity 12-1
12.1 The Corporate Form of Organization 12-2
12.2 Accounting for Share Transactions 12-12
12.3 Accounting for Dividends and Splits 12-19
12.4 Reporting and Analyzing Equity 12-28

13 Investments 13-1
13.1 Debt Investments 13-2
13.2 Accounting for Equity Investments 13-15
13.3 Financial Statements Presentation 13-23

14 Statement of Cash Flows 14-1
14.1 Statement of Cash Flows: Usefulness and Format 14-3
14.2 Preparing the Statement of Cash Flows-Indirect Method 14-7

15 Financial Analysis: The Big Picture 15-1
15.1 Basics of Financial Statement Analysis 15-2
15.2 Ratio Analysis 15-9
15.3 Sustainable Income 15-20

Appendix A Specimen Financial Statements: Taiwan Semiconductor Manufacturing Company, Limited A-1
Appendix B Specimen Financial Statements: Nestlé SA B-1
Appendix C Specimen Financial Statements: Delfi Limited C-1
Appendix D Specimen Financial Statements: Apple Inc. D-1
Appendix E Time Value of Money E-1
Appendix F Accounting for Partnerships F-1
Appendix G Subsidiary Ledgers and Special Journals G-1

Subject Index I-1
Company Index I-13