1.  Financial Accounting and Accounting Standards      - Opening section dealing with  capital allocation has been rewritten   - New section on Challenges Facing Accounting Profession             - Revised and expanded discussion of international accounting standards

2.  Concepts Underlying Financial Accounting           - Increased emphasis on fair value accounting

3.  The Accounting Information System: A Review - Discussion of adjusting entries has been rewritten and streamlined -Revised discussion of the trial balance

4.  Income Statement and Equity Statement            - New section on the statement of stockholders' equity, including subsections on the retained earnings statement and appropriations of retained earnings                                                                                             -New  material on other comprehensive income, with presentation of alternative formats

5.  Balance Sheet and Statement of Cash Flows        ·New section on the usefulness of the cash flow statemetn, including two
financial ratios and coverage of free cash flows
·Simplified discussion of contingencies
·Expanded discussion of disclosure of accounting policies, including addition of sample disclosue of significant risks and uncertainties
·New chapter-ending appendix on ratio analysis

6.  Accounting and Time Value of Money            - Symbolism has been standardized and terminology simplified

7.  Receivables                                                          -Cash controls discussion moved to an appendix                           -Discussion of transfer of receivables updated to reflect FASB 125 -Analysis of receivables now integrated 

8.  Valuation of Inventories: A Cost Basis Approach -LIFO reserve coverage now integrated into chapter

9.  Inventories: Additional Valuation Problems     -Section on analysis of inventories now included

10.  Acquisition and Disposition of Property,         Plant and Equipment                                        - Appendix on specialized interest capitalization has been deleted

11.  Depreciation, Impairments, and Depletion      - Simplified presentation of special depreciation methods by deleting the
inventory method, the retirment and replacement methods (now covered in a footnote), and the compound interest methods
-Coverage of income tax depreciation moved to chapter appendix
-Updated  illustration of disclosure of property, plant, and equipment
-Updated  illustration of presentation of disclosure of natural resources
-New discussion of teh efect of FASB No. 121 on US oil companies                                                       

12. Intangible Assets                                             - New vignette addressing the hot issue of valuing soft assets, such as
knowledge workers and intellectual property
-Deleted section on property rights
-Deleted example of balance sheet presentation of intangibles with contra
valuation account
-Updated appendix for new exposure draft on software accounting

13.  Current Liabilities and Contingencies             - Simplified discussion  of short-term debt expected to refinanced
-New material on gain contingencies, including an illustration
-Expanded discussion of self-insurance, including an illustration of
self-insurance disclosure (merged from Ch. 16)
-Merged coverage of contingent liabilities from Ch. 5

14.  Long-Term Liabilities                                - Streamlined chapter coverage by deleting section on defeasance and moving coverage of financial instruments and derivatives to Chapter 18 -Added analysis related to long-term debt                                             -Revised presentation of long-term debt, including new headings for income statement and balance sheet presentation and note disclosure

15.   Stockholders' Equity: Contributed Capital  - Discussion of the corporate form of organization moved to the beginning of the chapter
-New illustration on corporate buybacks
-Revised and expanded discussion of cost method of accounting for treasury stock
-Par value method moved to chapter appendix; new illustrations to show
stockholders' equity with and without treasury stock under par value method
-Simpler illustration of balance sheet presentation of redeemable preferred stock

16.   Stockholders' Equity: Retained Earnings      - Integrated analysis of stockholders' equity
-New, updated data on dividend payouts added as an illustration
-Section on self-insurance moved out of this chapter and combined with
coverage in chapter 13
-Added section on ratio analysis related to stockholders' equity
-New example of  columnar format for  statement of stockholders' equity

17.   Dilutive Securities & Share Earnings Calculations - Chapter coverage updated for FASB No. 123, "Accounting for Stock-Based Compensation" and FASB No. 128 "Earnings Per Share"

18.  Investments                                                  -Moved transfers of nivestment securities between categories to appendix -Added appendix on financial instruments with emphasis on derivatives

19.  Revenue Recognition

20.  Accounting for Income Taxes                           -Updated to emphasize new research findings                                      -Updated illustration of income taxes disclosures (PepsiCo)

21.  Accounting for Pensions & Retirement Benefits Updated discussion of pensions plans, including updated statistical data
-New illustration of note disclosure for pensions
-Discussion of disclosure effectiveness related to pensions

22.  Accounting for Leases                               - Discussion of sale-leaseback moved to chapter appendix"
-Deleted appendix on leveraged leases

23.  Accounting Changes and Error Analysis          - Updated research and statistical data on types and disclosures of changes

24.  Statement of Cash Flows                         -Condensed introductory historical discussion

25.  Basic Financial Statement Analysis                  - New discussion of segment reporting, disaggregations               -Enhanced coverage of safe harbor provisions and financial instruments