Financial and Managerial Accounting for Undergraduates, 2e

by Wallace, Nelson, Christensen, Hobson, Matthews

| ISBN: 978-1-61853-310-4 | Copyright 2020

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Welcome to Financial & Managerial Accounting for Undergraduates!

We wrote this book to satisfy the needs of students taking an introductory course in financial and managerial accounting by providing a high quality, contemporary, and engaging textbook at an affordable price. 

Financial & Managerial Accounting for Undergraduates 2e is written for students who want to understand how financial statements are prepared and how the information in published financial reports is used. It will also introduce students to management accounting concepts and decision making tools that will help them become effective managers in an increasingly competitive global market. The publication of this text has benefited from extensive feedback and suggestions from focus groups, market surveys, manuscript reviews, and interviews with faculty from across the country.

Target Audience

Financial & Managerial Accounting for Undergraduates is intended for use in introductory financial and managerial accounting courses at the undergraduate level; courses that balance the development of financial statements and management accounting tools, with their interpretation and use in decision making. This book teaches future business professionals how to read, analyze, and interpret accounting and other company, industry, and economic data to make informed business decisions.


Incredible Value: Offered at $130 net to the bookstore (which includes textbook and access to MBC), your students will benefit from high quality course materials and access to online learning tools at a price significantly lower than that of other textbooks.


Students frequently ask this or similar questions. The extent to which they feel accounting is relevant to their daily lives will often determine how much effort they put into the course. The following features are used throughout the book to convey the relevance of accounting to their lives and society.

Real Company Examples in Financial Chapters

Students better engage in the learning process and retain concepts through real and familiar examples. Throughout the text, authors incorporate real financial statements and examples from companies such as Microsoft, Amazon, and Google that prepare students to make real world business decisions. The Extending Your Knowledge section in the assignments throughout the financial accounting chapters, requires students to use the financial statements of Columbia Sportswear Company and Under Armour

Extensive Service Industry Coverage in Managerial Chapters

The service sector is the fastest growing segment of the U.S. economy. The managerial accounting chapters include Service Industry Margin Callouts identifying the sections that apply managerial accounting concepts to the service industry.  Further, each managerial accounting chapter concludes with a Service Industry in Focus case that provides students an opportunity to apply what they learned within a service industry situation.

Data Analytics

A discussion of data analytics is included in the new edition to expose students to its relevance in accounting.

Accounting in Practice

Accounting Information in Practice boxed inserts help students bridge the gap between the classroom and what students will encounter in the real world.  These inserts present real business scenarios and the choices companies face in making decisions.

Your Turn!

Your Turn! Boxed inserts are integrated throughout each chapter and reinforce the concepts and techniques just presented through immediate practice. Solutions are provided at the end of each chapter so students can check their work.


As professionals, students will eventually be confronted with day-to-day-decisions that have ethical implications. The authors discuss ethics where appropriate in the textbook, including assignments throughout the text that raise ethical issues.

Student Success

As accounting can be challenging, the authors include many features throughout the text that provide additional direction for students. Mapping Each Chapter – each chapter begins with an overview that visually depicts the layout of the chapter. A.K.A. Boxes – inform students of commonly used alternative terms that they may encounter in practice. Hints – additional suggestions inserted in the margin to help students understand difficult concepts.

Road Map

Each chapter opens with a grid that identifies each learning objective for the chapter, the related pages, guided example videos, and end of chapter assignments. This allows students and faculty to quickly grasp the chapter contents and to efficiently navigate to the desired topic.

Financial Chapters Reflect Current FASB Standards

The text and assignments were updated to reflect the new revenue recognition standard, Chapter 6 on Inventory was updated for new standard on lower of cost or net realizable value, the lease appendix in Chapter 10 was updated for the new lease standard, and Appendix D on Investments was updated to reflect the new standard.

New Coverage

A new section on Natural Resources and Depletion has been added to Chapter 9.

Managerial Chapters Integrated with Excel

In the managerial chapters, the authors demonstrate data analysis concepts in Excel such as cost –volume-profit relationships and overhead cost allocations. Excel templates are provided for select assignments and are identified by an EXCEL icon. 

Data Analysis

Cost-Volume-Profit Relationships (Chapter 19) includes an expanded discussion of regression analysis using Excel to develop cost formulas. 


Additional assignments and video examples have been added to MBC, so nearly all of the textbook assignments are available in the system.

Additional Assignments

Additional assignments were added to ensure adequate reinforcement of each learning objective.  

Additional Test Bank Questions

Additional test bank questions were added to ensure adequate assessment of each topic.

More Your Turn! Boxes

Now each learning objective ends with a comprehensive Your Turn! exercise that gives students even more opportunities to practice. Each Your Turn! is accompanied by a short video clip walking students through the solution.

James S. Wallace

James S. Wallace

Associate Professor at The Peter F. Drucker and Masatoshi Ito Graduate School of Management at The Claremont Graduate University.

He received his Bachelors of Arts from the University of California, Santa Barbara, his MBA from the University of California, Davis, and his PhD from the University of Washington. Professor Wallace also holds a CPA certification from the state of California. He previously served on the faculty of the University of California, Irvine and has served as a visiting professor at the University of California, San Diego. Professor Wallace's work has appeared in leading academic journals including the Journal of Accounting and Economics, the Journal of Corporate Finance, and Information Systems Research, along with leading applied journals such as the Journal of Applied Corporate Finance, the Journal of Accountancy, Issues in Accounting Education and Accounting Horizons. Prior to his career in academics, Professor Wallace worked in public accounting and in industry with a Fortune 500 company. He has done consulting work with numerous companies in multiple industries.

Karen K. Nelson

Karen K. Nelson

M.J. Neeley Professor of Accounting at TCU. Former Harmon Whittington Professor of Accounting and past Accounting Area Coordinator at the Jones Graduate School of Business at Rice University.

Karen previously served on the faculty at Rice University, the Stanford University Graduate School of Business, and as a visiting professor at the University of Michigan. She earned her Ph.D. at the University of Michigan and a bachelor’s degree (summa cum laude) from the University of Colorado. She also holds a CPA license from the state of Colorado. Professor Nelson’s research focuses on financial reporting and disclosure issues, including the role of regulators, auditors, and private securities litigation in monitoring financial reporting quality. She has held research seminars at over 50 leading business schools in the U.S. and abroad, and published in a variety of leading academic journals including The Accounting Review, Journal of Accounting and Economics, Journal of Accounting, and Review of Accounting Studies. Her research has been featured in the financial press in publications such as The Wall Street Journal, Business Week, and Forbes. She is an active member of the American Accounting Association and serves on the Editorial Board of The Accounting Review. She has taught financial accounting at all levels, and her students have honored her with numerous awards for teaching excellence. She currently teaches intermediate accounting to undergraduates and financial accounting to MBAs. She is a member of the Standing Advisory Group of the Public Company Accounting Oversight Board.

Theodore E. Christensen

Theodore E. Christensen

Director and Terry Distinguished Chair of Business in the J.M. Tull School of Accounting at the University of Georgia (UGA).

Prior to coming to UGA, he was on the faculty at Brigham Young University from 2000-2015 and at Case Western Reserve University from 1995-2000. He was a visiting professor at the University of Michigan (2013-2014) and the University of Utah (2012) and has taught at Santa Clara University in a summer program since 2005. He received a B.S. degree in accounting from San Jose State University, an M.Acc. degree in tax from Brigham Young University, and a Ph.D. in accounting from the University of Georgia. Professor Christensen has authored and coauthored articles published in many journals, including The Accounting Review; the Journal of Accounting and Economics; the Journal of Accounting Research; Review of Accounting Studies; Contemporary Accounting Research; Accounting Organizations and Society; the Journal of Business Finance & Accounting; the Journal of Accounting, Auditing, and Finance; Accounting Horizons; and Issues in Accounting Education.

L. Scott Hobson

L. Scott Hobson

L. Scott Hobson is a teaching Professor of Accounting at Brigham Young University (BYU) since 2003.

He received his B.S. in Accounting and Master of Accountancy Degrees from BYU in 1983. Prior to his career in academics, Professor Hobson was the founder and the owner of Hilton Farnkopf & Hobson (now HFG Consultants), a management consulting firm headquartered in Walnut Creek, California, for 14 years. He also worked in public accounting at Price Waterhouse for 5.5 years in both audit and consulting. While at Price Waterhouse, he taught for 2 years as an adjunct faculty at San Jose University. He has taught accounting at all levels, from principles to M.B.A. courses, including managerial accounting, financial accounting, governmental and not-for-profit accounting, and management consulting. Professor Hobson is licensed as a CPA (inactive) in California. Professor Hobson has published a case titled "Managing the CPA Firm at Dodge Company" in Issues in Accounting Education.

Jason W. Matthews

Jason W. Matthews

Senior Lecturer of Accounting and Director of Undergraduate Programs in the J.M. Tull School of Accounting at the University of Georgia (UGA)

He received his B.S. from Missouri State University; his Master of Accountancy degree from North Carolina State University; and his Ph.D. from the University of Georgia. Prior to his career in academics, Dr. Matthews was the interim Chief Financial Officer at Roark Capital Group, a private equity firm with approximately $12 billion in equity capital based in Atlanta, Georgia. He was also the Director and Chief Financial Officer at United Coal Company, a producer of metallurgical and steam coal and the Director and Chief Financial Officer of Oculan Corporation, which developed hardware and software related to IT security management.  Dr. Matthews has taught across all levels at UGA, including financial accounting to full-time and Executive M.B.A. students, accounting information systems to MAcc students, cost accounting and audit to accounting majors, and introductory financial and managerial accounting to non-accounting majors. He is the recipient of numerous teaching awards, including most recently the 2018 Terry College of Business Instructional Excellence Award and the 2018 Pearcy B. Yeargin Outstanding Undergraduate Teacher of the Year award. He has been active in serving on committees in the Teaching Learning and Curriculum section of the American Accounting Association and is a CMA.