Index I-4Goodwill, 114, 414, 415
Gross pay, 444
Gross profit, 26, 212
and operating profit analysis, 233
Growth investors, 552
H
Held-to-maturity securities, 549
Horizontal analysis, 26, 632
I
Illusory profits, 277
Income
net, 13, 15
operating, 217
other, 217
Income from continuing operations
unusual items reported above, 538
unusual items reported below, 540
Income from operations, 217
Income statement, 14, 15, 64, 110, 112
H&R Block, 212
Hershey Foods Corporation, 15, 26
Home Depot, 213
multiple-step, 214
single-step, 217
tax differences between tax return
and, 460
unusual items affecting, 538, 539
with earnings per share, 543
Wm. Wrigley Jr. Company, 70
Income statement data for direct
method, 592
Income taxes
cash payments for, 595
depreciation for federal, 409
payable, 587
Incorporation
application of, 494
articles of, 495
Indirect method, 234, 581
adjustments to net income, 586
statement of cash flows, 234,
584
Information and communication, 313
Initial public offering (IPO), 497
Intangible assets, 12, 114, 412
comparison of, 415
frequency of disclosures, 415
in the balance sheet, 416
reporting of, 415
Integrated financial statements, 19, 20,
66, 69, 116, 168, 220
approach, 54
framework, 55
Integration of financial statements, 115,
218
Interest, 447
expense, 595
payable, 11
Interest method, 455–456
amortization of discount by, 468
amortization of premium by, 469
Internal control, 306, 307
elements of, 309
objectives, 308
problems, indicators of, 314
procedures, 311
report on adequacy of, 654
Internal Revenue Code, 496
Internal Revenue Service (IRS), 405
International Accounting Standards
(IASs), 26, 61, 112, 169, 278,
370, 405, 452, 509, 541, 580,
638
International Accounting Standards
Board, 217
Inventory, 587, 594, 633
and cash flows, 283
at lower of cost or market, determining,
280
book, 230
control of, 268
finished goods, 266
manufacturing, 266
materials, 266
merchandise, 213, 266
methods, periodic and perpetual, 216
number of days’ sales in, 282, 644
physical, 230, 268
valuation of at other than cost, 279
work-in-process, 266
Inventory analysis, 643
and interpretation, 282
Inventory cost flow assumptions, 268
Inventory costing methods, 271
comparing, 277
effect of on financial statements, 270
under a periodic inventory system,
274
under a perpetual inventory system,
271
Inventory cycle, 154
Inventory ledger, 268
Inventory misstatements on the financial
statements, effects of, 231
Inventory profits, 277
Inventory shortage, 230
Inventory shrinkage, 230
Inventory turnover, 282, 643
Investing activities, 12
cash flows from, 580, 581
cash flows used for, 235
net cash flow provided by, 581
net cash flow used for, 581
noncash, 582
Investment reporting, 548
Investments, 357, 400, 546
accounting for purchase, interest, and
amortization of bond, 550
and cash flows, 555
in bonds, 549, 551
in stocks, 544, 547
temporary, 544
Invoice, 223J
Journal, 157general, 157
special, 157
Journal entry, 157, 164
effects on the financial statements,
158
posting, 161
Journalizing, 157L
Land, 590
Last-in, first-out (lifo) method, 269, 272,
275
Ledger, 162, 170–171
general, 160
inventory, 268
posting to, 160
subsidiary, 221
Legal capital, 497
Lender, 442
Leverage, 465, 638
analysis, 645
formula, 638
summary, 650
Liabilities, 114, 467
contingent, 461, 463
current, 114, 442, 587
deferred, 459
long-term, 114, 442, 447
payroll, 444
reporting, 462
to stockholders’ equity, ratio of, 649
Liability, 11
Liability analysis, long-term, 465
Liability for employer payroll taxes, 445
Lifo conformity rule, 278
Lifo reserve, 278
Limited liability company (LLC), 5
Line of credit, 327
Liquidity, 464
Long-term debt, current maturities of,
462
Long-term investments in stocks, 546
Long-term liabilities, 114, 442, 447
ratio of fixed assets to, 648
Long-term liability analysis, 465
Long-term liability disclosures, 462
Loss, net, 13, 15
Low-cost emphasis, 7
Lower-of-cost-or-market (LCM) method,
280M
Maintenance and repairs, ordinary,
403
Maker, 365
Management discussion and analysis
(MDA), 653
Management reporting system, 153
Management’s philosophy and operat-
ing style, 310
Managerial accounting, 13, 153
Mandatory vacations, 311
Manufacturers, inventory classification
for, 266