Fundamentals of Financial Accounting

Book Preface

The second edition of Phillips/Libby/Libby Fundamentals of Financial Accounting was a great success, thanks to the ideas and direction
provided by a dedicated panel of reviewers, many students, and a host of talented contributors. It was named “Revision of the Year” across all of McGraw-Hill’s business and economics textbooks. The third edition furthers our commitment to providing the best accounting textbook for teaching and learning fi nancial accounting. With its innovative student-centered approach, unique and interactive pedagogical tools, and compelling instructor and student resources, no other text presents fi nancial accounting in such a clear and studentfriendly manner. The keys to its success:

ENGAGING WRITING.

Fundamentals of Financial Accounting introduces students to fi nancial accounting using an appropriate mix of conversational wording, clear and concise presentations, and everyday examples. It does this without ever sacrifi cing its rigor or the concepts that are important to grasping fi nancial accounting. Students can feel comfortable as they are introduced to the world of fi nancial accounting.

RELEVANT FOCUS COMPANIES.

Each chapter of Fundamentals of Financial Accounting makes fi nancial accounting come alive by using a real company whose products and services are popular with students. Students learn fi nancial accounting concepts through the use of examples from such companies as American Eagle (clothing), Activision (video games), Skechers (shoes), and Under Armour (sportswear).

THE POWER OF REINFORCEMENT.

Several tools help reinforce the concepts discussed in the text. Coach’s Tips and You Should Know are innovative and student-friendly pedagogical features that appear in the margins to reinforce concepts in the text as well as offer helpful insight.

The accounting world is encountering new challenges and Fundamentals of Financial Accounting aims to help you and your students take them in stride. You will fi nd some important changes in the third edition that will give your students the tools and information necessary to help them succeed. Based on the feedback and advice from several fi nancial accounting faculty, the most signifi cant of those changes include:

• The entrepreneurial focus company in Chapter 1 has been extended through Chapters 2, 3, and 4, allowing students to see how a business plan (Chapter 1) leads to actual fi nancing and investing decisions (Chapter 2), operating activities (Chapter 3), and adjustments made prior to evaluating the fi nancial results (Chapter 4). Students emerge from the fi rst four chapters with a solid understanding of how the accounting process plays a pivotal role in business.
• Anticipating a greater emphasis on International Financial Reporting Standards (IFRS) in the United States and recognizing its presence in more than 100 countries worldwide, we have integrated selected IFRS topics in appropriate chapters at a level  suitable for introductory fi nancial accounting. We summarize these topics at the end of the last chapter in the book (in chapter supplement 13B) and we tie this summary to specifi c references in each chapter. To support discussions and analyses involving IFRS, we have introduced more than 20 questions and exercises in end-of-chapter assignments that specifi cally focus on IFRS.

Not all students learn fi nancial accounting with ease. With so many distractions these days, it is diffi cult to keep both majors and non-majors focused on the big picture. The authors of Fundamentals of Financial Accounting understand the challenges instructors face and the need for a fi nancial accounting text that is relevant, easy to read, and current.

Fundamentals of Financial Accounting responds by using carefully chosen focus companies that students not only recognize but are familiar with because they have visited or used their products. From companies like the local pizza restaurant to the world’s most familiar businesses, each chapter features the business and accounting concepts underlying prominent companies such as Walmart, Activision, Cedar Fair, American Eagle, National Beverage, Under Armour, and General
Mills.

Through crisp, clear, and engaging writing, the fi nancial decisions these companies make and the fi nancial statements they use come alive for students and they are able to see the big picture of how accounting relates to the real world——their world.