3M Company The financial statements of 3M are presented in Appendix 5B or can be accessed on the Take Action! CD.

Instructions Refer to 3M’s financial statements and the accompanying notes to answer the following questions.

(a) Using the notes to the consolidated financial statements, determine 3M’s revenue recognition policies.

Comment on the impact of SEC SAB No. 101 on 3M’s financial statements.

(b) Give two examples of where historical cost information is reported in 3M’s financial statements and related notes. Give two examples of the use of fair value information reported in either the financial statements or related notes.

(c) How can we determine that the accounting principles used by 3M are prepared on a basis consistent with those of last year?

(d) What is 3M’s accounting policy related to advertising? What accounting principle does 3M follow regarding accounting for advertising?