tailieunhanh - Ebook Financial accounting (10th edition): Part 2 - W. Steve Albrecht

(BQ) Part 2 book "Financial accounting" has contents: Investments in property, plant, and equipment and in intangible assets, long term debt financing, equity financing, investments in debt and equity securities, the statement of cash flows, introduction to financial statement analysis,.and other contents. | A R T 3 © DUNCAN SMITH/PHOTODISC GREEN/GETTY IMAGES INC. 9 Long-Term Debt Financing 0 Equity Financing q Investments in Debt and Equity Securities w Investments in Property, Plant, and Equipment and in Intangible Assets Investing and Financing Activities P C H A P T E 9 R © AP PHOTO/SARA D. DAVIS Investments in Property, Plant, and Equipment and in Intangible Assets LEARNING OBJECTIVES After studying this chapter, you should be able to: 1 2 3 4 5 6 Identify the two major categories of longterm operating assets: property, plant, and equipment and intangible assets. A company needs an infrastructure of long-term operating assets in order to produce and distribute its products and services. In addition to property, plant, and equipment, long-term operating assets also include intangible items such as patents and licenses. 7 8 Understand the factors important in deciding whether to acquire a long-term operating asset. A company should purchase a long-term operating asset if the future cash flows expected to be generated by the asset are “large” in comparison to the cost to purchase the asset. Record the acquisition of property, plant, and equipment through a simple purchase as well as through a lease, by self-construction, and as part of the purchase of several assets at once. The recorded cost of property, plant, or equipment includes all costs needed to purchase the asset and prepare it for its intended use. Assets can be acquired through purchase, leasing, exchange, self-construction, or through the purchase of an entire company. Compute straight-line and units-ofproduction depreciation expense for plant and equipment. Depreciation is the process of systematically allocating the cost of a long-term asset over the service life of that asset. If that service life is measured in years, then a reasonable way to allocate the cost is equally over the years; this is called straight-line depreciation. Account for repairs and improvements of property,