American Public University Operations And Supply Chain Management Assignment Help - Financial Accounting

Question - Case 3-5: International versus U.S. Standards in Ch. 3 of Financial Accounting Theory and Analysis
Case 3-5 International versus U.S. Standards Under U.S. GAAP, property, plant, and equipment are
reported at historical cost net of accumulated depreciation. These assets are written down to fair
value when it is determined that they have been impaired. A number of other countries, including
Australia, Brazil, England, Mexico, and Singapore, permit the revaluation of property, plant, and
equipment to their current cost as of the balance sheet date. The primary argument favoring
revaluation is that the historical cost of assets purchased ten, twenty, or more years ago is not
meaningful. A primary argument against revaluation is the lack ...Read More of objectivity in arriving at current cost
estimates, particularly for old assets that either will or cannot be replaced with similar assets or for
which no comparable or similar assets are currently available for purchase. Required: a. Discuss the
qualitative concept of comparability. In your opinion, would the financial statements of companies
operating in one of the foreign countries listed above be comparable to a U.S. companys financial
statements? Explain. b. Discuss the concept of reliability. In your opinion, would the amounts reported
by U.S. companies for property, plant, and equipment be more or less reliable than the current cost
amounts reported by companies in England, Mexico, or elsewhere? c. Discuss the concept of
relevance. In your opinion, would the amounts reported by U.S. companies for property, plant, and
equipment be more or less relevant than the current cost amounts reported by companies in England,
Mexico, or elsewhere? ...Read Less

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