COMPLETE SOLUTION MANUAL AND INSTRUCTOR
RESOURCE FOR Intermediate Accounting, 18th
Edition, by Donald E.Kieso, Jerry J. Weygandt and
Terry D. Warfield. ISBN-13 978-1119790976
Chapter 1
Financial Accounting and Accounting Standards
Topics Questions BriefOExe Exercises CriticalO
rcises Thinking
1. EnvironmentO ofOacco 1,2,O3,4 1 1 1
unting,Oprinciples,Oobj
ectives,O standards,Oac
countingtheory.
2. AuthoritativeOpronou 5,6,O7,8 2 2 2
ncementsOandOrule-
makingObodies.
3. ConceptualOframework- 9,O 10 3 3,4
Ogeneral,O objectiveO ofOfinanc
ialOreporting.
4. QualitativeOcharacteristicsOof 11,12,O13,O14, 3,4,O5,O6,O7 4,5,6 5,O 10
accounting. 15,O16,17
5. ElementsOof 18,O19 8,O9 7
OfinancialOst
atements.
6. BasicOassumptionsOand 20,O21,O 22,O23, 10,O11,O12, 4,O 8,O 9,O 10, 6,O 7,O 8,O 9,O 11
principles. 24,O 25,O 26,O 27, 13,O14 11,O12
28,O 29,O 30,31
7. CostO constraint. 32,33,34
8. RoleOofOpressureOgroups. 35,O36 12,O14,O 15,O 16,
17
9. EthicalO issues. 37,O38,39,40 13
Assignment Classification Table (By Topic)
CopyrightO©O2022OWILE Kieso,OIntermediateOAccounting,O18/e,OSolutionsOManu (ForOInstructorOUseOOnl 5-1-1
Y al y)
, Assignment Classification Table (By Learning Objective)
O O O O O
LearningOObjectives Questions BriefOExerc Exercises CriticalOTh
ises inking
1. DescribeOtheOfinancialOreportingO 1,O2,O3,O4, 1,O2 1,O2 1
environment,OmajorOstandard- 5,O6,O7,O8
OsettingObodies,OandOtheOmeanin
gOofOgenerallyOacceptedOaccounti
ngOprinciplesO(GAAP).
2. DescribeOtheOcomponentsOandOusef 9,O 10,O 11,O12, 3,O5,O6, 3,O4,O 5,O6,O 7 2,3,4,O5,
ulnessO ofOtheOconceptualOframewor 13,O 14,O15,O 16, 7,O8,9 10
k. 17,O18,O19
3. DiscussOtheO basicO assumptions 20,O 21,O 22,O23, 4,O 10,O 11, 8,O9,O 10,O 11, 6,O 7,O 8,O 9,
andO principlesO ofO accounting. 24,O 25,O26,O 27, 12,O13,O14 12 11,O12
28,O 29,O31,
32,O33,O34
4. IdentifyOtheOmajorOchallengesOin 30,O35,O 36,O 37, 2 11,O13,O 14,
theOfinancialO reporting 38,O39,40 15,O16
environment.
Assignment Characteristics Table (Time on Task)
O O O O O
Item Description LevelOofO TimeO(
Difficulty minutes)
E1.1 NeedOforO GAAP. Simple 15-20
E1.2 FinancialO reportingO andO accountingO standards. Simple 15-20
E1.3 Usefulness,O objectiveO ofOfinancialO reporting. Simple 15-20
E1.4 Usefulness,O objectiveOofOfinancialO reporting,Oqualit Simple 15-20
ativeOcharacteristics.
E1.5 QualitativeO characteristics. Moderate 20-30
E1.6 QualitativeO characteristics. Simple 15-20
E1.7 ElementsO ofOfinancialO statements. Simple 15-20
E1.8 Assumptions,Oprinciples,O andO constraint. Simple 15-20
E1.9 Assumptions,Oprinciples,O andO constraint. Moderate 20-25
E1.10 FullOdisclosureO principle. Complex 20-25
E1.11 AccountingOprinciplesO andO assumptions- Moderate 20-25
E1.12 AccountingO principles-comprehensive. Moderate 20-25
CT1.1 SecuritiesO andO ExchangeO Commission. Moderate 30-40
CT1.2 ConceptualO framework-general. Simple 20-25
CT1.3 ConceptualO framework-general. Simple 25-35
CT1.4 ObjectiveO ofOfinancialO reporting. Moderate 25-35
CT1.5 QualitativeO characteristics. Moderate 30-35
5-1-2 CopyrightO©O2022OWILE Kieso,OIntermediateOAccounting,O18/e,OSolutionsOManu (ForOInstructorOUseOOnl
Y al y)
, CT1.6 RevenueO recognitionO principle. Complex 25-30
CT1.7 ExpenseO recognitionO principle. Complex 20-25
CT1.8 ExpenseO recognitionO principle. Moderate 20-25
CT1.9 ExpenseO recognitionO principle. Moderate 20-30
CT1.10 QualitativeO characteristics. Moderate 20-30
CT1.11 ExpenseO recognitionO principle. Moderate 20-25
CT1.12 CostO Constraint. Moderate 30-35
CT1.13 Rule-makingO Issues. Complex 20-25
CT1.14 ModelsOforO settingO GAAP. Simple 15-20
CT1.15 EconomicO consequences. Moderate 25-35
CT1.16 GAAPO andO economicO consequences. Moderate 25-35
Answers to Questions O O
1. IfOaOcompany‘sOfinancialOperformanceOisOmeasuredOaccurately,Ofairly,OandOonOaOtimelyObasis,OtheOri
ghtOmanagersOandOcompaniesOcanOattractOinvestmentOcapital.OUnreliableOandOirrelevantOinformation
OleadsOtoOpoorOcapitalOallocation,OwhichOadverselyOaffectsOtheOefficiencyOofOtheOsecuritiesOmarket.
LO:O1,OBloom:OK,ODifficulty:OSimple,OTime:O1-3,OAACSB:OCommunication,OAICPAOBC:ONone,OAICPAOAC:OReporting,OAICPAOPC:OCommunication
2. TheOobjectiveOofOgeneralOpurposeOfinancialOreportingOisOtoOprovideOfinancialOinformationOaboutOtheO
reportingOentityOthatOisOusefulOtoOpresentOandOpotentialOequityOinvestors,Olenders,OandOotherOcredito
rsOinOmakingOdecisionsOaboutOprovidingOresourcesOtoOtheOentityOthroughOequityOinvestmentsOandOloa
nsOorOotherOformsOofOcredit.OInformationOthatOisOdecision-
usefulOtoOcapitalOprovidersO(investors)OmayOalsoObeOusefulOtoOotherOusersOofOfinancialOreportingOwh
oOareOnotOinvestors.
LO:O1,OBloom:OK,ODifficulty:OSimple,OTime:O3-5,OAACSB:OCommunication,OAICPAOBC:ONone,OAICPAOAC:OReporting,OAICPAOPC:ODecisionOMaking
3. InvestorsOareOinterestedOinOfinancialOreportingObecauseOitOprovidesOinformationOthatOisOusefulOforOm
akingOdecisionsO(referredOtoOasOtheOdecision-
usefulnessOapproach).OWhenOmakingOtheseO decisions,OinvestorsOareOinterestedOinOassessingOtheO
company‘sO(1)OabilityOtoOgenerateOnetOcashOinflowsOandO(2)Omanagement‘sOabilityOtoOprotectOandOe
nhanceOtheOcapitalOproviders‘Oinvestments.OFinancialOreportingOshouldOthereforeOhelpOinvestorsOas
sessOtheOamounts,Otiming,OandOuncertaintyOofOprospectiveO cashO inflowsOfromOdividendsOorOinterest
,OandOtheOproceedsOfromOtheO sale,Oredemption,OorOmaturityOofOsecuritiesOorOloans.OForOinvestorsOto
OmakeOtheseOassessments,OtheOeconomicOresourcesOofOanOenterprise,OtheOclaimsOtoOthoseOresourc
es,OandOtheOchangesOinOthemOmustObeOunderstood.
LO:O1,OBloom:OK,ODifficulty:OSimple,OTime:O3-5,OAACSB:OCommunication,OAICPAOBC:ONone,OAICPAOAC:OReporting,OAICPAOPC:ODecisionOMaking
4. AOcommonOsetOofOfinancialOaccountingOandOreportingOstandardsOappliedObyOallObusinessesOandOent
itiesOshouldOproduceOfinancialOstatementsOwhichOareOreasonablyOcomparable.OWithoutOaOcommonO
setOofOstandards,OeachOenterpriseOcould,OandOwould,OdevelopO aOtheoryOstructureOandOsetOofO practi
ces,OresultingOinOnoncomparabilityOamongOtheOfinancialOstatementsOofOenterprises.
LO:O1,OBloom:OK,ODifficulty:OSimple,OTime:O3-5,OAACSB:OCommunication,OAICPAOBC:ONone,OAICPAOAC:OReporting,OAICPAOPC:OCommunication
5. TheOSECOhasOtheOpowerOtoOprescribe,OinOwhateverOdetailOitOdesires,OtheOaccountingOpracticesOandO
principlesOtoObeOemployedObyOcompaniesOthatOfallOwithinOitsOjurisdiction.OBecauseOtheOSECOreceive
sOauditedOfinancialOstatementsOfromOnearlyOallOcompaniesOthatOissueOsecuritiesOtoOtheOpublicOorOareOl
istedOonOstockOexchanges,OitOisOgreatlyOinterestedOinOtheOcontent,Oaccuracy,OandOcredibilityOofOtheOsta
tements.OForOmanyOyears,OtheOSECOreliedOonOtheOAICPAOtoOregulateOtheOprofessionOandOdevelopO
CopyrightO©O2022OWILE Kieso,OIntermediateOAccounting,O18/e,OSolutionsOManu (ForOInstructorOUseOOnl 5-1-3
Y al y)
, andOenforceOaccountingO principles.O Lately,O theO SECO hasO assumedO aO moreO activeO roleO inO theO
developmentO of
5-1-4 CopyrightO©O2022OWILE Kieso,OIntermediateOAccounting,O18/e,OSolutionsOManu (ForOInstructorOUseOOnl
Y al y)
