Principles of Accounting
12th Edition
ISBN: 9781285607047
Author: NEEDLES
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
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?
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
2. Discuss how using debt ratios applies to your personal finances.3. What does the P/E ratio or EPS tell you about a companies’ overall financial condition? 4. What industry statistics can a business use for comparison?5. How can they use that information in their business? Please give a specific example.
with the help of the statement of income of the company attached please answer the below:
1: evaluate the companies on the basis of its financial strenght for lending purposes. will you select this company for lending? Why?
Studying AIS helps students understand business processes from an accounting perspective. Which of the following activities would commonly be associated with the financing process?
Selling goods and services on credit
Issuing equity securities
Making payments to vendors
Hiring employees to work in the finance department
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...
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- To obtain financing for a business, it is important to; a. Offer collateral b. Determine the amount of money needed c. Make arrangements to pay back d. All of the abovearrow_forwardBusinesses engage in multiple activities that can be categorized as Financing, Investing, and Operating activities. All of the following are considered Financing activities except: Select one: a. Borrowing money from a bank b. Issuing Common Stock c. Payment of cash dividend d. Purchasing manufacturing equipment e. Repayment of Bonds Payable Clear my choicearrow_forwardDiscuss how using debt ratios applies to a business.Discuss how using debt ratios applies to your personal finances.What does the P/E ratio or EPS tell you about a companies’ overall financial condition? 4. What industry statistics can a business use for comparison?5. How can they use that information in their business? Please give a specific example.arrow_forward
- Assume that Ruby Associates is in the process of applying financing facility from MyBank. For that purpose, MyBank requires RA to submit the company’s financial statements to be reviewed by the bank. i. Why MyBank request the financial statements? Give TWO (2) reasons ii. Identify and explain the relevant information from the financial statements the important for MyBank in making decision.arrow_forwardExternal users of financial accounting information include all of the following except ________. A. lenders such as bankers B. governmental agencies such as the IRS C. employees of a business D. potential investorsarrow_forwardQuestion:Prepare a reflection paper that incorporates your answers to the following independent questions: 1. What problems can you foresee if a business manager does not have a basic knowledge of accounting? 2. The owner of a company asks you if he can charge all his personal expenses to his business. He said that he owns the company anyway. Explain to the business owner the business entity assumption and the ethical considerations of his idea. 3. After examining the financial statements, the owner of a small business expressed surprise that the firm's cash balance had decreased during the month even though there was substantial net income. Do you think this owner is right to expect the cash to increase because of a substantial net income? Why or why not? 4. Jiffy Trading runs 10 branches and pays for a variety of expenses. Anna, the Accounts Payable Clerk of Jiffy Trading writes the checks for each supplier and the Accounting Manager signs the checks. Anna decided she…arrow_forward
- A bank loan approved for the business that has been paid into the bank account will have the following impact on the accounting equation. Group of answer choices Increase equity and increase asset Decrease an asset and decrease a liability Decrease an asset and decrease stockholders’ equity Increase an asset and increase a liabilityarrow_forwardACCOUNTING MULTIPLE CHOICE QUESTIONS. ANSWER ALL IF POSSIBLE An account balance is: A. The total of the credit side of the account B. The total of the debit side of the account C. The difference between the total debits and total credits for an account including the beginning balance D. Always a credit Show Transcribed Text O Businesses can take any of the following forms of business ownership except: A. Sole proprietorship C. Joint Offering B. Partnership D. Corporation FOB shipping point means that the A. goods are placed free on board to the buyer's place of business. B. buyer pays the freight. Show Transcribed Text 3 C. seller pays the freight. D. common carrier pays the freight. C Show Transcribed Text Income from operations is A. Net sales less Cost of goods sold. B. Net sales less Operating expenses. C. Gross profit less Other expenses and losses. D. Gross profit less Operating expenses. When completing a bank reconciliation, what action should you take regarding "Outstanding…arrow_forwardConsider the following statements. For each one of them state whether the statement is true or false and provide a brief explanation to support your answer. a) Financial accounting is targeted at external users while management accounting focuses on internal users. b) The trial balance is part of a company’s financial statements. c) Bank loans are always non-current liabilities. d) In accounting, revenues are recognised whenever there is a cash transfer. e) As understandability is one of the key characteristics of accounting according to the IASB conceptual framework, transactions that are too difficult should not be recognised in the accounts.arrow_forward
- 1.1.7 Which one of the following best helps users of the financial statements when they need to compare information on the financial statements of the same entity and/or the financial statement of different entities? A. Matching principle. B. Accrual concept. c. Consistency principle. D. Prepaid concept 1.1.8 The principle that any personal transactions undertaken by the owner of a business entity must be kept separate from that business entity is known as: A. Principle of duality. B. Entity concept. c. Consistency principle D. Accrual concept. 1.1.9 Complete the following sentence. The purpose of the statement of changes in equity is to; A. Express the financial position at a given point in time. B. Reconcile the net worth of an entity at the beginning of the year to the net worth at the end of the year. C. Measure the performance of the entity by determining the profit or loss for the period. D. Measure the ability of an entity to generate, manage and use cash efficiently.arrow_forward1. Define Revenue. 2. What is an expense? 3. What is the purpose of an expense? 4. What is net income? 5. What is a net loss? 6. Why are owners interested in the income statement? 7. Why are bankers interested in the income statement of a business to which they loan money? 8. Why would investors provide a business with cash? 9. Why must a business provide an income statement to the governmen? 10. tWhy are drawings not included in the income statement?arrow_forward1. Explain and describe the type of information needed by each of these users: Revenue expenses profitability debt 2. Explain each accounting principles Accrual principle Conservatism principle Consistency principle Cost principle Economic entity principle Full disclosure principle Going concern principle Matching principle Materiality principle Monetary unit principle Reliability principle Revenue recognition principle Time period principle 3. Define and explain each qualitative characteristics of useful financial information: Verifiability Timeliness Understandability Comparability 4. Differentiate the types of business according to its activity: Service business Merchandising business Manufacturing businessarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Principles of Accounting Volume 1AccountingISBN:9781947172685Author:OpenStaxPublisher:OpenStax College
Principles of Accounting Volume 1
Accounting
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax College
ACCOUNTING BASICS: Debits and Credits Explained; Author: Accounting Stuff;https://www.youtube.com/watch?v=VhwZ9t2b3Zk;License: Standard Youtube License