Introduction to Financial Accounting: A User Perspective - Hardcover

Werner, Michael L.; Jones, Kumen H.

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9780130327598: Introduction to Financial Accounting: A User Perspective

Hardcover

ISBN 10: 013032759X ISBN 13: 9780130327598

Publisher: Pearson College Div, 2003

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An excellent introduction to financial accounting, this book informs the reader about its significant role in making sound business decisions. With its concentration on the uses of financial accounting rather than on the preparation of accounting information, the authors present the information in a manner that makes the topic readily available for use in a broad number of ways. This complete and easy to understand financial accounting book covers the following topics briefly, yet comprehensively: economic decision-making and business in the United States; balance sheets; income statements and statements of owners' equity; economic management; the accounting system; long-lived depreciable assets; inventory accounting; cash flow statements; and a close look at financial statement analysis. For readers needing a book that will allow them a basic understanding of financial accounting.

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From the Back Cover:

Mike Werner and Kumen Jones have crafted an exciting series of texts designed to meet the needs of those faculty and students who are eager to embrace a user perspective in first-year accounting.

Introduction to Financial Accounting: A User Perspective, Third Edition, covers the essential topics of financial accounting. Rather than rote memorization, the text first introduces a concept framework that emphasizes understanding of how all employees use accounting information to make effective business decisions. Additional features include:

Optional Treatment of Debits and Credits. Starting with Chapter 7, the authors include optional appendices on debits and credits at the ends of chapters to complement the material in stand-alone Chapter 6, "Accumulating Accounting Data." This material may be included or omitted at the discretion of each faculty member.
Annual Report Project Included in Assignment Material. Faculty members can tailor the project to suit their needs by assigning all of it or selected parts.
NEW—Fewer Chapters. The financial portion of the text is now only 11 chapters. (Chapters 3 and 4 from the second edition are combined into a single Chapter 3 on the balance sheet.)
NEW—Distinctive Presentation of Accounting Procedures (Chapter 6). Part I describes each step of the accounting cycle. Part II introduces debits and credits and demonstrates each accounting cycle step from journalizing transactions to closing entries.
NEW—Integration of Financial Topics. Statement of Cash Flows and Key Financial Ratios are introduced now in Chapter 3 and are integrated throughout the text where appropriate.

In-depth coverage of the direct method of the statement of cash flows is moved to an appendix.
Financial statement analysis chapter presents charts for each of the 17 ratios calculated for Pier 1 Imports and two peer companies.

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Introduction to Management Accounting: A User Perspective, Second Edition, maintains the authors' well-received user approach and places a high emphasis on decision making. Other unique features include:

NEW-Separate Chapter on Cost Allocation and ABC (Chapter 4).
User-Driven Approach to Cost Behavior (Chapters 5 and 6).
Unique Chapter on Evaluating Performance (Chapter 11) discusses evaluation methods; centralized and decentralized management styles, business segments, return on investment and residual income; nonfinancial measures, such as quality, customer satisfaction, employee morale, employee safety, efficiency, and just-in-time philosophy.
Distinctive Presentation of the Operating Budget (Chapter 9). Part I describes the importance and uses of the operating budget and compares/contrasts various approaches to preparation. Part II shows step-by-step preparation of the budgets that comprise the operating budget and details the use of the operating budget in the overall management process.

Of course, if you want the best of both books, then Introduction to Accounting: A User Perspective, Second Edition, is the best solution because this single volume contains the full versions of both Introduction to Financial Accounting: A User Perspective, Third Edition, and Introduction to Management Accounting: A User Perspective, Second Edition. A seamless year of principles material included within one book!

And an extensive technology support package includes Internet tools, PowerPoints, and general ledger software available to accompany each text!

The world is changing, accounting education is changing, and so are accounting textbooks. Our book is no exception. In this edition, we have incorporated a number of changes that we believe will make this book an even better teaching resource than previous editions. In addition to rewriting much of the material for improved clarity, we have integrated coverage of the statement of cash flows and key financial ratios throughout the text. We also consolidated the two balance sheet chapters into one. In this edition, we added significantly to the assignment material and improved its alignment with the topics covered in each chapter. We have revised the chapter opening vignettes to increase student interest and to suggest the need for the accounting applications covered in the chapters. You will find that these changes, along with many others, help make this text an easy-to-use tool to teach beginning accounting students.

BASIC PHILOSOPHY

Businesspeople must be prepared to perform tasks that only people can perform; in particular, they must be able to communicate, to think, and to make solid, well-informed decisions. Decision making is the critical skill in today's business world, and Introduction to Financial Accounting: A User Perspective, Third Edition, helps students to better use accounting information to improve their decision making skills.

This text provides an introduction to accounting within the context of business and business decisions. Readers will explore accounting information's role in the decision making process and learn how to use the accounting information found in financial statements and annual reports. Seeing how accounting information can be used to make better business decisions will benefit all students, regardless of their major course of study or chosen career.

We agree with the recommendations made by the Accounting Education Change Commission in its Position Statement No. Two: The First Course in Accounting. We believe the course should be a broad introduction to accounting, rather than introductory accounting as it has traditionally been taught. It should emphasize what accounting information is, why it is important, and how it is used by economic decision makers.

This text is purposely written so students will find it easy to read and understand. In this edition, many passages have been rewritten to further enhance readability and student understanding. In addition; we include the exhibits necessary to get important points across, but we very intentionally do not include the array of glitz and graphics that can break up the flow and distract student attention. We do not generally segregate material into special presentation boxes that might be skipped by students attempting to focus on the most relevant points. All of the points of interest and examples we present are woven into the body of the text.

SUPPORT FOR THE INTERACTIVE CLASSROOM

We believe this text provides tools to actively involve students in their learning processes. The conversational tone of the text, its user perspective, and the logical presentation of topics all contribute to the ability of this text to meet that goal. However, several features are particularly important in developing a classroom atmosphere in which students share ideas, ask questions, and relate their learning to the world around them.

Throughout each chapter of the text, you will find Discussion Questions (DQs) that challenge students to reach beyond the surface of the written text to determine answers. Far from typical review questions, for which the students can scan a few pages of the text to locate an answer, many of the DQs provide relevant learning by relating students' personal experiences to the knowledge they gain through the text.

The DQs provide a variety of classroom experiences:

Many DQs provide the basis for lively classroom discussions, requiring students to think about issues and formulate or defend their opinions.
Some DQs are springboards for group assignments (in or out of the classroom) to put cooperative learning into practice.
DQs may be assigned as individual writing assignments to allow students to practice and develop their writing skills.
Combining individually written DO responses with follow-up group discussions can spark lively debate!
Having students keep a journal of their responses to all DQs (regardless of whether they are used in another way) encourages contemplation of accounting concepts.

The DQs comprise an important part of the text's pedagogy designed to emphasize important points that students may skim across in their initial reading. Even if they are not formally part of the required work for your course, students will gain a greater understanding of the concepts discussed when they take time to consider each question as part of the text.

Students get enthused about accounting when working with real companies. Chapter F1 and its appendix provide students with the knowledge they need to use library and Internet resources to research real companies. The chapter also introduces students to the annual report and Form 10-K. We included the 2002 Pier 1 Imports, Inc., annual report with our text with the hope that instructors will find it a helpful resource for class examples. We also use Pier 1 's annual report for selected assignment material and to demonstrate financial analysis in Chapter F11.

Aside from its support for the interactive classroom, a major distinction of this text is its total separation of the use of accounting information and its preparation.

SEPARATION OF ACCOUNTING AND BOOKKEEPING

Coverage of recording procedures differs from school to school. Some schools choose to have all students learn basic accounting procedures; others require only accounting majors to acquire these skills. Our text offers institutions the flexibility to cover accounting procedures to a significant degree, to cover just the basics, or to omit the coverage of accounting procedures entirely. In this text, we do not use debits and credits or journal entries to demonstrate or explain characteristics and uses of accounting information. In fact, except in the accounting procedures chapter itself (Chapter F6), no references are made to the recording process except in chapter appendices. To facilitate the separation of accounting and bookkeeping, we introduce the accounting cycle in Chapter F6 and complete its coverage in appendices to Chapters F7, F8, and F9. We hold off coverage of accounting procedures until Chapter F6 to give students the chance to acquire the basic accounting background that will help make accounting procedures easier to comprehend and learn.

Institutions that desire to omit recording procedures entirely would simply skip Chapter F6 and these appendices from their course coverage.

For those institutions that would like to include accounting procedures in their introductory accounting curriculum, Chapter F6 and the appendices in Chapter F7 through F9 cover the complete accounting cycle from analyzing transactions through post-closing trial balance. Coverage includes debits and credits, journal entries, adjusting entries, posting to the general ledger, trial balance preparation, the worksheet, and financial statement preparation. Chapter F6 assignment material includes short, medium, and long accounting procedure problems. In addition, the chapter includes three mini practice sets that take a student from the beginnings of a company all the way through the preparation of financial statements.

IMPROVED AND EXPANDED ASSIGNMENT MATERIAL

In this edition, we added significantly to the assignment material and improved the alignment of assignment material with the topics cooed in each chapter.

Discussion Questions. As we have already mentioned, throughout each chapter of the text, you will find Discussion Questions (DQs) that challenge students to reach beyond the surface of the written text to determine answers.
Review the Facts. Students can use these basic, definitional questions to review the key points of each chapter. The questions are in a sequence reflecting the coverage of topics in the chapter.
Annual Report Project. The text includes a completely revised annual report project that begins in Chapter Fl and continues throughout the text. Adventures into real information about real companies always raise student interest! In addition it can foster an open, interactive environment in the classroom. In Chapter Fl, the annual report project assignment requires students to select a publicly traded company and to obtain the company's Form 10-K and annual report. Instructors should not be concerned that they will need to spend valuable class time to tell students how to accomplish the assignment. The text and the material included in the assignment itself provide enough guidance so that students should be able to obtain the Form 10-K and annual report by themselves. The annual report project requirements in later chapters are similarly supported by the text. In Chapter F3, students use key financial ratios to analyze their company, and in Chapter F6, students select a peer company to use as a comparison throughout the remainder of the project. Instructors should note that even if they omit coverage of Chapter F6, the annual report project for Chapter F6 should be assigned as it is vital to the continuity of the project.
Apply What You Have Learned. These end-of-chapter assignment materials include a mix- of traditional types of homework problems and innovative assignments requiring critical thinking and writing. Many of the requirements can be used as the basis for classroom discussions. You will find matching problems, short essay questions, and calculations. Assignments dealing directly with the use of financial statements are also included. Many of these applications also work well a...

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