Financial Accounting (3rdCanadian Edition), by Libby et al.

Textbook Errata

Chapter 1
Page 18
Market (Purchase) Price
Posted Sept. 24, 2008
Chapter 2
Page 47
Exhibit 2.1
Posted Jan. 4, 2009
Page 67
Transaction (g)
Posted Sept. 24, 2008
Chapter 3
Page 115
First paragraph
Posted Jan. 4, 2009
Chapter 4
Page 166
Exhibit 4.4
Page 178
Exhibit 4.5
Posted Sept. 24, 2008
Page 183
Page 193
Page 193
Posted Jan. 4, 2009
Chapter 4
Page 194
Posted Jan. 4, 2009
Chapter 5
Page 238
Exhibit 5.3
Page 241
Exhibit 5.4
Page 242
Posted Jan. 4, 2009
Page 242
Posted April 14, 2009
Page 243
Posted Jan. 4, 2009
Chapter 7
Page 359
Middle of page
Posted Jan. 4, 2009
Page 378
E7-4
Posted July 22, 2008
Page 382
E7-16
Posted Jan. 4, 2009 / The net income figure is incorrect and the market price should read as follows:
= 21 x $48,689,000
= $1,022,469,000
The box labeled Constraints should include Materiality [Ch. 4], Cost/Benefit [Ch. 6], and Conservatism [Ch. 6]
The effects of the transaction on assets should read:
Cash + 300
Notes Receivable – 300
The date in the first sentence should read April 30, 2007, rather than March 31, 2007.
The headings in columns 3 and 4 should read:
Deferred Expenses Accrued Expenses
The totals for the credit column under the unadjusted trial balance should read 654,000.
In the Return on Equity section, the company’s name under Comparisons over time should read Van Houtte instead of Intrawest.
The solution to transaction c in question 7 in the Demonstration Case is partially incorrect. The amount should read $38, not $52, the effect on Assets is O and the effect on Liabilities is NE.
The solution to Self-Study Quiz 4.3 should read as follows:
Income before income taxes = $76,300 - $58,210 = $18,090
Income tax expense = $18,090 x 25% = $4,522
Net income = $18,090 – $4,522 = $13,568
Net profit margin = $13,568 ÷ $72,800 = 0.186 or 18.6%.
The first sentence should read as follows:
The difference between the two ratios is due to the end-of-period adjustments that increased revenues by $1,000 and increased expenses by $8,208, thus lowering net income significantly by $7,208, from $13,568 to $6,360. The difference between the two ratios is 10%.
The changes in the assets accounts that appear under the Change column on the right of the exhibit are not aligned properly. They should be one line above where they are printed.
The explanation for Increase in inventories should read: Subtract because cost of goods sold is less than purchases.
The paragraph below the Accounts Receivable T-account should read: The balance sheet for APL indicates an increase in accounts receivable of $6005 for the period, which means cash collected from customers is lowerthan revenue. To convert to cash flow from operating activities, the amount of increasemust be subtracted from net income in Exhibit 5.4.
The beginning balance of the T-account Prepaid Expenses should read 3,318 instead of 3,138.
In the middle of the page, the paragraph that reads “APL’s accruedliabilities decreased by $470" should read “APL’s income taxes payabledecreased by $470.”
The denominator of the computation of the Average Collection Period shouldread $773,190 ÷ 365.
In the Nov. 20 transaction, the second sentence “Visa charges Hailey a 2-percent credit card fee” should read:“Visa charges Gonzo a 2-percent credit card fee.”
The net amounts of credit card receivable should read 1,418 for Year 2 and 1,129 for Year 1.
Chapter 8
Page 419
Lower half of page
Posted Jan. 4, 2009
Chapter 9
Page 507
E9-26
Posted Nov. 14, 2008
Page 515
AP9-1
Page 517
AP9-3
Posted April 14, 2009
Chapter 10
Page 545
Page 576
Posted Jan. 4, 2009
Chapter 11
Page 583
Page 585
Page 609
E11-12
Posted Jan. 4, 2009
Page 618
AP11-1
Posted April 14, 2009
Chapter 12
Page 655
Posted Jan. 4, 2009
Page 663
P12-2
Posted July 22, 2008
Chapter 13
Page 685
Exhibit 13.4
Page 688
Posted Jan. 4, 2009
Appendix A
Page 723
Table A.2
Posted Jan. 4, 2009 / In the Cost of Goods Sold Calculation (Moving Weighted-Average Cost), the line for Sales (February 28) should read (900 units at $208 each).
In the second paragraph, the year 2008 should read 2010.
The year 2013 should read 2012.
3rd line from the top: Lucas should read Dumas.
In the solution to Self-Study Quiz 1, the current ratio for 2005 should read
1.03.
In the Financial Analysis section, the last sentence in the second paragraph should read: “As the yield increased relative to the fixed coupon rate, the price decreased from $98.37 on March 16, 2007, to $96.67 on August 16, 2007, which illustrates the inverse relationship between the yield and the bond price.”
In the Amortization Schedule, column (d) should read “Beginning
Book Value – (c)” (i.e., the plus sign should be a minus sign).
In the Amortization Schedule, column (c) should read “(a) – (b)” and column (d) should read “Beginning Book Value – (c)” (i.e., the plus sign should be a minus sign).
The third line should read: “they mature on June 30, 2013.”
The underwriting fee should read $3,812,500 instead of $4,312,500.
The word debentures should read notes throughout the problem.
The year 2006 should read2007 in Required 2.
Requirement 6 refers the reader to requirement 2; it should be requirement 4.
In the solution to Self-Study Quiz 12-1, question 3, the amount of dividends payable should read 183,508,160.
The sentence “During 2005, the following transactions occurred in the order given” should read: “During 2009, the following transactions occurred in the order given.”
In ratio 14, Times interest earned, the numerator should read “Net
Income + Interest Expense + Tax Expense.”
In ratio 15, Cash coverage, the numerator should read “Cash Flow from Operating Activities (before interest and tax paid)”
In the Earnings per Share calculation for Home Depot, the denominator should read 2,054, (i.e., the $ sign should be omitted).
The formula for present value of an annuity is missing a set of brackets and should read: [1 - 1/(1 + i)n ] / i.