Www. 07.4
Revaluation of Long-lived Assets. The Queensbury Corporation was founded in 1947 on a decommissioned
military installation that had been purchased from the U. S. government for a price of $1. Today, that same
land carries a fair market value of $70 million. Consistent with the historical cost principle, The Queensbury
Corporation continues to value the land at its original purchase price of $1 plus the cost of any improvements
(such as roadways, lights, and drainage) Discuss the financial statement problems created by the historical
cost principle for entities like The Queensbury Corporation that have significant investments in long-lived
appreciating assets (such as land), Should these companies be allowed to revalue these assets? Why? How
would a land revaluation be reflected in the financial statements?

You and your new australian bride matilda, are applying for a loan and are required to submit a balance sheet with your net worth. you own a 2008 toyota camry that you bought last month for $9,995. the kelly blue book value for this car is $13,995. you owe $8,150 on the car loan for the camry. you pay off your visa credit card every month and have not paid any credit card interest this year. the current visa credit card balance is $3,522, and the next statement is due in 15 days. you have a student loan balance of $6,500. you presently have $425 in your checking account and $1,540 in your savings account. you own 100 shares of ibm stock that you purchased for $85.50 per share. one share of ibm is now selling for $158.42. you own computers and other electronics that you purchased for $4,100 but could probably sell today on e-bay for $1,800. your gross income is $80,000 per year. what is your current net worth? (see wb ch. 2 example 2.3)

Specialization—the division of labor—enhances productivity and efficiency by a) allowing workers to take advantage of existing differences in their abilities and skills. b) avoiding the time loss involved in shifting from one production task to another. c) allowing workers to develop skills by working on one, or a limited number, of tasks. d)all of the means identified in the other answers.

What is used by accountant to analyze transactions ?