SOLUTION MANUAL FOR
FINANCIAL ACCOUNTING FOR MANAGERS 1ST EDITION BY WAYNE THOMAS
AND DAVID SPICELAND AND MARK NELSON
CHAPTER 1 y
y A FRAMEWORK FOR FINANCIAL ACCOUNTING
y y y y
yREAL WORLD PERSPECTIVES
y y
RWP1-1 EDGAR Nike (ticker: NKE)
y y y y
Requirementy1
a. $23,717ymillion
b. $9,040ymillion
c. Totalyliabilitiesy=yTotalyassetsy–ytotalyshareholder’syequity
$23,717y–y$9,040y=y$14,677ymillion
Requirementy2
a. $39,117ymillion.yRevenueyincreasedyfromytheypreviousyyear.
b. $4,029ymillion.yNetyincomeyincreasedyfromytheypreviousyyear.
Requirementy3
a. Operatingycashyflowy=y$5,903ymillion.yOperatingycashyflowywasymoreypositive
thanytheypreviousyyear.
b. Investingycashyflowy=y−$264ymillion.yInvestingycashyflowywentyfromypositiveytoyne
gativeyfromytheypreviousyyear.
c. Financingycashyflowy=y−$5,293ymillion.yFinancingycashyflowywasymoreynegative
thanytheypreviousyyear.
RWP1-2 EDGAR Netflix Inc (ticker: NFLX)
y y y y y
Requirementy1
a. Averageypayingymembershipyincreasedybyy23%yandyaverageymonthlyyrevenueyper
payingymembershipyincreasedybyy5%.
b. $2,795,434y/y$20,156,447y=y13.9%
c. $2,652,462,y13%yofyrevenues
Requirementy2
a. $9,801,215y/y$24,504,567y=y40%
b. $33,141ymillion
©McGrawyHillyLLC.yAllyrightsyreserved.yNoyreproductionyoryfurtherydistributionypermittedywithoutytheypriorywrittenyconsentyofyMcGrawyHillyLLC
SolutionsyManual,y Chaptery5 5-1
,©McGrawyHillyLLC.yAllyrightsyreserved.yNoyreproductionyoryfurtherydistributionypermittedywithoutytheypriorywrittenyconsentyofyMcGrawyHillyL
LC
5-2 FinancialyAccountingyforyManagers
,Requirementy3
a. $20,723,441.y Long-termydebtywentyupyfromytheypreviousyyear.
b. $736,969
Requirementy4
9%
Requirementy5
a. Ernsty&yYoungyLLP
b. Yes
RWP1-3 EDGAR General Mills Inc. (ticker: GIS)
y y y y y y
Requirementy1
FirstyQuarter.
Requirementy2
Augusty26,y2018.y Theysameyquarteryofylastyyearyisyusedyasytheycomparisonyquarter.
Requirementy3
Theyquarterlyyreportyincludesy15ynotes.
RWP1-4 EDGAR Nordstrom Inc. (ticker: JWN)
y y y y y
Requirementy1
TheyCOVID-19ypandemic.
Requirementy2
OnyMarchy23,y2020,ytheyCompanyyannouncedythatyitywouldybeytakingyseveralystepsyinyanyabundanceyo
fycautionytoyproactivelyystrengthenyitsyfinancialyflexibilityyandynavigateythroughythisyunprecedentedysit
uation.ySpecifically,ytheyCompanyysuspendedyitsyquarterlyydividendybeginningyinytheysecondyquartery
ofy2020,ydrewydowny$800ymillionyonyitsyRevolvingyCredityFacility,ytargetedyfurtheryreductionsyofymo
reythany$500ymillionyinyoperatingyexpenses,ycapitalyexpenditures,yandyworkingycapital,yandysuspende
dyshareyrepurchases.
©McGrawyHillyLLC.yAllyrightsyreserved.yNoyreproductionyoryfurtherydistributionypermittedywithoutytheypriorywrittenyconsentyofyMcGrawyHillyLLC
SolutionsyManual,y Chaptery5 5-3
, RWP1-5 Financial Analysis: American Eagle
y y y y
($yinythousands)
Requirementy1
Totalyassets =y$3,328,679
Totalyliabilities
=y$2,080,826y
Stockholders’yequity =y$1,247,853
Assets = Liabilities + Stockholders’yEquity
$3,328,679 = $2,080,826 + $1,247,853
Requirementy2
ConsolidatedyStatementsyofyOperations
Requirementy3
Netysales =y$4,308,212
Netyincome =y$191,257
Requirementy4
Inflows Outflows
Investingyactivities Saleyofyavailable-for-sale Capitalyexpendituresyfor
investments propertyyandyequipment
Financingyactivities Netyproceedsyfromystocky Repurchaseyofycommonystock
optionsyexercised
Requirementy5
Theycompany’syauditoryisyErnsty&yYoungyLLP.
Theyauditorystates,y―WeyhaveyauditedytheyaccompanyingyconsolidatedybalanceysheetsyofyAmericanyEa
gleyOutfitters,yInc.y(theyCompany)yasyofyFebruaryy1,y2020yandyFebruaryy2,y2019,ytheyrelatedyconsolid
atedystatementsyofyoperations,ycomprehensiveyincome,ystockholders’yequityyandycashyflowsyforyeachy
ofytheythreeyyearsyinytheyperiodyendedyFebruaryy1,y2020,yandytheyrelatedynotesy(collectivelyyreferredyto
yasythey―consolidatedyfinancialystatements‖).y Inyouryopinion,ytheyconsolidatedyfinancialystatements ypre
sentyfairly,yinyallymaterialyrespects,ytheyfinancialypositionyofytheyCompanyyatyFebruaryy1,y2020yandyFe
bruaryy2,y2019,yandytheyresultsyofyitsyoperationsyandyitsycashyflowsyforyeachyofytheythreeyyearsyinytheype
riodyendedyFebruaryy1,y2020,yinyconformityywithyU.S.ygenerallyyacceptedyaccountingyprinciples.‖
©McGrawyHillyLLC.yAllyrightsyreserved.yNoyreproductionyoryfurtherydistributionypermittedywithoutytheypriorywrittenyconsentyofyMcGrawyHillyL
LC
5-4 FinancialyAccountingyforyManagers
