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Book details
ISBN: 9780078025365 / 0078025362
Division: Higher Education
Pub Date: JAN-12
Pages: 832

Copyright: 2013
Edition: 8
Format: Hardback
Fundamental Financial Accounting Concepts

Thomas Edmonds, Frances McNair, Philip Olds


About the book

Course: Fundamental Financial Accounting Concepts 8th Edition by Edmonds/McNair/Olds is ideal for the undergraduate introductory financial accounting course, specifically for those wanting to focus on the relationships between business events and financial statements. This text is also appealing to those instructors looking for a shorter text that focuses more on “key” financial accounting concepts rather than rather than procedural details, and to those desiring a stronger user orientation in their course. Overview: Students are often overwhelmed by the amount of information presented in the introductory financial accounting course. By focusing on fundamental concepts in a logical sequence, students are able to fully comprehend the material rather than memorise seemingly unrelated terms and topics. The goal of Fundamental Financial Accounting Concepts is to enable students to understand how any given business event affects the financial statements. The “financial statements model” is a highly praised feature because it allows students to visualise the simultaneous impact of business events on all of the key financial statements (the income statement, the balance sheet, and the statement of cash flows).
Key features

  • New Chapters 1 and 2 have been broken into 2 parts that allow instructors to cover the pace of coverage.
  • Chapter 1, Section 1 covers basic terminology, introduces the accounting equation, and demonstrates how business events are recorded under the equation;
  • Chapter 1, Section 2 introduces students to financial statement.
  • Chapter 2, Section 1 covers accruals,
  • Section 2 covers deferrals.
    Breaking the chapters into sections offers an added benefit of promoting a stepwise learning environment.
  • New Enhanced coverage of financial statement analysis.
  • New Appendix for Chapter 2 that covers depreciation and the computation of interest with EOC material added covering these topics.
  • New Added coverage of the framework for internal controls and enterprise risk management developed by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) to Chapter 6.
  • New Appendix and related end-of-chapter materials to Chapter 3 that provide continuing coverage of depreciation and the computation of interest.
  • New Target annual report in Appendix D has been redesigned: Target's 2008, 2009, and 2010 financial statements have been loaded into an Excel spreadsheet that is available on the OLC. The income statement shown in the spreadsheet has been revised to better reflect the income statement format and wording used in the textbook. Credit card revenues (interest income) are moved to the non-operating section, enabling the project solution for gross margin percentages to agree to those identified in the Management Discussion & Analysis section of the annual report. A multiple choice project quiz is available in Connect.
  • McGraw-Hill Connect uses end-of-chapter material pulled directly from the textbook to create static and algorithmic questions that can be used for practice, homework, quizzes, and tests. All new texts come bundled with Connect Plus at no additional cost.
  • Restructuring of first four chapters to permit an earlier introduction of debits and credits. Previous to Edition 7, Chapter 2 covered accruals and Chapter 3 covered deferrals. The authors combined the contents of these two chapters so that accruals and deferrals are now introduced in a single chapter. Both subjects are now covered in Chapter 2. To avoid information overload, we moved the introduction of depreciation to Chapter 8, Accounting for Long-Term Operational Assets. Further, the introduction of interest calculations was moved to Chapter 7, Accounting for Receivables.
  • Focus on Concepts The text focuses on the fundamentals of financial accounting. Isolating concepts and presenting them in a logical sequence facilitates learning. The text also maintains a manageable length (12 chapters) by focusing on only the most important topics.
  • Distinctive Financial Statements Model This pedagogical tool helps students visualise the simultaneous impact of business events on all of the key financial statements (the income statement,the balance sheet, and the statement of cash flows).
  • Business Transactions are Classified into 4 Logical Categories Instead of attempting to memorize transactions, students learn to classify events as belonging to one of four conceptual categories. More specifically, students learn to classify transactions as being a 1) Asset source, 2) Asset use, 3) Asset exchange, or 4) Claims Exchange. This approach encourages students to think about the effects of events rather than the memorization of recording procedures.
  • Coverage of Multi-Period Cycles Typically, financial accounting texts focus only on one accounting cycle. Edmonds presents the key financial statements in such a way as to demonstrate the impact of related events over multiple accounting cycles. This benefits students by showing them the impact of business decisions over time. Managers of companies rarely make important decisions based on only one accounting cycle.
  • Integrated Statement of Cash Flows Coverage of the statement of cash flows begins in the first chapter and continues throughout the text. Students are first asked to analyze the cash account. When the cash account is used as the data source, preparing a statement of cash flows is simply a matter of learning how to classify events as operating, investing or financing activities. More complicated process of converting accrual based income to cash flow is covered in Ch. 12.
  • Decision-Making Orientation Concepts are introduced within a decision-making context. Features such as “Curious Accountant” highlight real world accounting issues and decisions.
  • Check Yourself feature that asks students to stop and think about the concept discussed before moving to the next concept.
  • A Look Back/A Look Forward Each chapter ends with a summary of the main points and a preview of the next chapter with an emphasis on how they connect. This approach enhances the stepwise, logical organisation of the book and helps students understand how everything connects together.
  • The Financial Analyst highlights financial statement analysis in each chapter.
  • Self-Study Review Problem at the end of each chapter is a representative problem with a detailed solution to be worked before attempting end of chapter problems.
  • Comprehensive Problems Chapters 4 through 11 include a comprehensive problem designed to integrate concepts across chapters. These problems help students understand interrelationships between various accounting concepts. The problem builds in each successive chapter, with the ending account balance in one chapter becoming the beginning account balance in the next chapter.
  • • Analyze, Think, Communicate Updated and feature strong critical thinking component and provide opportunities for writing and group assignments. ATC contains Annual Report Problems, Financial Ratio Problems, Writing Assignments, Ethical Dilemmas, EDGAR Cases, and Working with Excel and Mastering Excel problems. Also, Ethics Case for each chapter. • Working with Excel and Mastering Excel problems-students create their own spreadsheets, using information from the text. Located at the end of each chapter. Screen captures and spreadsheet tips guide students. • Excel Templates – Logo identifies end-of-chapter problems that include an Excel template. These help students develop spreadsheet skills. Templates are on the OLC website.
  • Annual Report Integrated Throughout Text Edmonds– includes the Target Corporation Annual portion of Form 10-k as an appendix. In the Annual Report and Financial Statement Analysis Projects section (Appendix D) projects for Target Corporation are included as well as a general purpose report project instructors can assign for any company–s annual report.
  • Pairs logically with Edmonds, Managerial Text For believers in the Edmonds “fundamental concepts” approach; we can cover both introductory courses (financial and managerial) for a cohesive foundation in accounting.

  • About the author

    Thomas Edmonds
    Thomas P. Edmonds, Ph.D.: Dr. Edmonds is Professor of Accountancy at the University of Alabama at Birmingham, (UAB). He has been actively involved in teaching accounting principles throughout his academic career. He has received several prestigious teaching awards, including the UAB President’s Excellence in Teaching Award and the distinguished Ellen Gregg Ingalls Award for excellence in classroom teaching. His academic experience includes being published in the Journal of Accounting Education, the Accounting Review, and the Journal of Accounting, Auditing and Finance among others. Dr. Edmonds received his Ph.D. in Accounting from Georgia State University.

    Frances McNair
    Frances M. McNair, Ph.D., CPA: Dr. McNair holds the KPMG Peat Marwick Professorship of Accounting at Mississippi State University, (MSU) and received her Ph.D. in Accounting from the University of Mississippi. Her research has been published in the Journal of Accountancy, Management Accounting, and the Business and Professional Ethics Journal.

    Philip Olds
    Philip R. Olds, Ph.D., CPA: Dr. Olds is Professor of Accounting at Virginia Commonwealth University, and received his Ph.D. from Georgia State University.

    Table of contents

    Chapter 1 An Introduction to Accounting
    Section 1: Collecting and Organizing Information
    Section 2: Reporting Information
    Chapter 2 Accounting for Accruals and Deferrals
    Section 1: Accounting for Accruals
    Section 2: Accounting for Deferrals
    Chapter 3 The Double-Entry System
    Chapter 4 Accounting for Merchandising Businesses
    Chapter 5 Accounting for Inventories
    Chapter 6 Internal Control and Accounting for Cash
    Chapter 7 Accounting for Receivables
    Chapter 8 Accounting for Long-Term Operational Assets
    Chapter 9 Accounting for Current Liabilities and Payroll
    Chapter 10 Accounting for Long-Term Debt
    Chapter 11 Proprietorships, Partnerships, and Corporations
    Chapter 12 Statement of Cash Flows
    Chapter 13 Financial Statement Analysis 13-0 (ONLINE ONLY)
    Appendix A Accessing the EDGAR Database through the Internet
    Appendix B Portion of the Form 10-K for Target Corporation
    Appendix C Summary of Financial Radios
    Appendix D Annual Report and Financial Statement Analysis Projects
    Appendix E Accounting for Investment Securities
    Appendix F Time Value of Money



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