Accounting Principles:A Business Perspective,Financial Accounting

Text Preview:
Accounting Principles:
A Business Perspective,
Financial Accounting (Chapters 1  8)

A Textbook Equity Open College Textbook

                originally by

     Hermanson, Edwards, and Maher

            Fearless copy, print, remix(tm)

           License: CC-BY-NC-SA
                ISBN-13: 978-1461088189
                  ISBN-10: 1461088186

                                              p. 1 of 433
About This Publication
Simply put, you may copy, print, redistribute, and re-purpose this textbook or parts of this
textbook provided that you give attribution (credit) to Textbook Equity, and provided that
any derivative work has the same Creative Commons license (CC-BY-NC-SA). That's it.

Textbook Equity, in turn, provides attribution, with thanks, to the Global Text Project, who
provided the source textbook.

Consistent with it's strategic mission to provide free and low-cost textbooks, this is Textbook
Equity's derivative work based on "Accounting Principles: A Business Perspective, First
Global Text Edition, Volume 1, Financial Accounting", utilizing the permissions granted by
it's Creative Commons license. Global Text Project nor the original authors endorse or are
responsible in any way for this printing or it's contents.

Textbook Provenance (1998 - 2011)
1998 Edition
Accounting: A Business Perspective (Irwin/Mcgraw-Hill Series in Principles of Accounting)
[Hardcover] Roger H. Hermanson (Author), James Don Edwards (Author), Michael W.
Maher (Author) Eighth Edition
     Hardcover: 944 pages
     Publisher: Richard D Irwin; 7 Sub edition (April 1998)
     Language: English
     ISBN-10: 0075615851
     ISBN-13: 978-0075615859
     Product Dimensions: 11.1 x 8.7 x 1.8 inches
    Current Hardbound Price $140.00 (

2010 Editions (
Global Text Project Conversion to Creative Commons License CC-BY
"Accounting Principles: A Business Perspective First Global Text Edition, Volume 1 Financial
Accounting", Revision Editor: Donald J. McCubbrey, PhD.
   PDF Version, 817 pages, Free Download

"Accounting Principles: A Business Perspective First Global Text Edition, Volume 2
Managerial Accounting", Revision Editor: Donald J. McCubbrey, PhD.
   PDF Version Volume 2, 262 pages, Free Download

                                                                                      p. 2 of 433
2011 Editions (
Textbook Equity publishes this soft cover version using a the CC-BY-NC-SA license. They
divided Volume 1 into two sections to fit paperback publishing requirements and made other
formatting changes. No content changes were made to Global Text's version. Versions
available at the Open College Textbook repository:
      PDF Version, Section 1 of Volume 1 (Chapters 1  8), 436 pages, Free Download
      Textbook Equity Paperback, Volume 1 Financial Accounting (Chapters 1  8), 436 pages, List
       Price $19.95
      PDF Version, Volume 1 Financial Accounting (Chapters 9  18), Free Download
      Textbook Equity Paperback, Volume 1 Financial Accounting (Chapters 9  18), List Price
      PDF Version Volume 2, (Chapters 19  26), Free Download
      Textbook Equity Paperback, Volume 2 (Chapters 19  24), List Price $19.95

  For original author information and acknowledgments see

                                                                                        p. 3 of 433
Preface from the eight edition:
Philosophy and purpose
   Imagine that you have graduated from college without taking an accounting course. You are
employed by a company as a sales person, and you eventually become the sales manager of a territory.
While attending a sales managers' meeting, financial results are reviewed by the Vice President of Sales
and terms such as gross margin percentage, cash flows from operating activities, and LIFO inventory
methods are being discussed. The Vice President eventually asks you to discuss these topics as they
relate to your territory. You try to do so, but it is obvious to everyone in the meeting that you do not
know what you are talking about.
   Accounting principles courses teach you the "language of business" so you understand terms and
concepts used in business decisions. If you understand how accounting information is prepared, you
will be in an even stronger position when faced with a management decision based on accounting
   The importance of transactions analysis and proper recording of transactions has clearly been
demonstrated in some of the recent business failures that have been reported in the press. If the
financial statements of an enterprise are to properly represent the results of operations and the
financial condition of the company, the transactions must be analyzed and recorded in the accounts
following generally accepted accounting principles. The debits and credits are important not only to
accounting majors but also to those entering or engaged in a business career to become managers
because the ultimate effects of these journal entries are reflected in the financial statements. If
expenses are reported as assets, liabilities and their related expenses are omitted from the financial
statements, or reported revenues are recorded prematurely or do not really exist, the financial
statements are misleading. The financial statements are only useful and meaningful if they are fair and
clearly represent the business events of the company.
   We wrote this text to give you an understanding of how to use accounting information to analyze
business performance and make business decisions. The text takes a business perspective. We use the
annual reports of real companies to illustrate many of the accounting concepts. You are familiar with
many of the companies we use, such as The Limited, The Home Depot, and Coca-Cola Company.
   Gaining an understanding of accounting terminology and concepts, however, is not enough to
ensure your success. You also need to be able to find information on the Internet, analyze various

                                                                                             p. 4 of 433
business situations, work effectively as a member of a team, and communicate your ideas clearly. This
text was developed to help you develop these skills.

Curriculum concerns
   Significant changes have been recommended for accounting education. Some parties have
expressed concern that recent accounting graduates do not possess the necessary set of skills to
succeed in an accounting career. The typical accounting graduate seems unable to successfully deal
with complex and unstructured "real world" accounting problems and generally lacks communication
and interpersonal skills. One recommendation is the greater use of active learning techniques in a re-
energized classroom environment. The traditional lecture and structured problem solving method
approach would be supplemented or replaced with a more informal classroom setting dealing with
cases, simulations, and group projects. Both inside and outside the classroom, there would be two-way
communication between (1) professor and student and (2) student and student. Study groups would be
formed so that students could tutor other students. The purposes of these recommendations include
enhancing students' critical thinking skills, written and oral communication skills, and interpersonal
   One of the most important benefits you can obtain from a college education is that you "learn how
to learn". The concept that you gain all of your learning in school and then spend the rest of your life
applying that knowledge is not valid. Change is occurring at an increasingly rapid pace. You will
probably hold many different jobs during your career, and you will probably work for many different
companies. Much of the information you learn in college will be obsolete in just a few years. Therefore,
you will be expected to engage in life-long learning. Memorizing is much less important than learning
how to think critically.
   With this changing environment in mind, we have developed a text that will lend itself to developing
the skills that will lead to success in your future career in business. The section at the end of each
chapter titled, "Beyond the numbers--Critical thinking", provides the opportunity for you to address
unstructured case situations, the analysis of real companies' financial situations, ethics cases, and team
projects. Each chapter also includes one or two Internet projects in the section titled "Using the
Internet--A view of the real world". For many of these items, you will use written and oral
communication skills in presenting your results.

                                                                                              p. 5 of 433
Download Link:
Share Link: Forum Link:

More on Business

  • Picture: Gr 10 Maths Literacy - Paper 1

    Gr 10 Maths Literacy – Paper 1

    File Size: 249.96 KB, Pages: 10, Views: 1,629,823 views

    GRADE 10 EXEMPLAR EXAMINATION NOVEMBER 2006 MATHEMATICS LITERACY PAPER 1 Minimum time: 1 hours Maximum time: 2 hours 75 marks PLEASE READ THE FOLLOWING CAREFULLY 1. This paper consists of: 5 questions an answer sheet with grid paper for question 4 (d). 2. Answer all …
  • Picture: Improving cash flow using credit management - CIMA

    Improving cash flow using credit management – CIMA

    File Size: 374.27 KB, Pages: 28, Views: 1,502,089 views

    Improving cash flow using credit management The outline case sponsored by Improving cash flow using credit management sponsored by Albany Software focuses on developing award-winning software to transform financial processes and is the market leader in electronic payment solutions. Albany makes financial transfers and subsequent …


    File Size: 311.77 KB, Pages: 8, Views: 605,960 views

    Product Name: MOBIL RARUS SHC 1025 Revision Date: 16Feb2007 Page 1 of 8 _____________________________________________________________________________________________________________________ _ MATERIAL SAFETY DATA SHEET SECTION 1 PRODUCT AND COMPANY IDENTIFICATION PRODUCT Product Name: MOBIL RARUS SHC 1025 Product Description: Synthetic Base Stocks and Additives Product Code: 606343-00, 973764 Intended Use: …
  • Picture: Onan RV Generator Troubleshooting Guide - Flight Systems, Inc.

    Onan RV Generator Troubleshooting Guide – Flight Systems, Inc.

    File Size: 2,729.64 KB, Pages: 18, Views: 38,542 views

    RV GENERATOR TROUBLESHOOTING GUIDE A Service of FLIGHT SYSTEMS 207 Hempt Road Mechanicsburg, PA 17050 Ph: 717 590 7330 Fax: 717 590 7327 CONTENTS RV Generator Troubleshooting Overview 1 RV Generator FAQs 5 Onan RV Generator Charts: Applications Chart 8 Test Information for Troubleshooting …
  • Picture: Interpretive Guide for the Achievement Levels Report (2003

    Interpretive Guide for the Achievement Levels Report (2003

    File Size: 624.72 KB, Pages: 19, Views: 39,133 views

    Interpretive Guide for the Achievement Levels Report (2003 Revision) ITBS/ITED Testing Program The purpose of this Interpretive Guide is to provide information to individuals who will use the Achievement Levels Report for monitoring the achievement of student grade groups, both at the building level and …

Leave a Reply

Your email address will not be published. Required fields are marked *