While a company’s financial reports – the income statement, the balance sheet, the cash flow statement and the statement of owners’ equity – represent the company’s financial health and progress, they can’t provide a perfectly accurate picture. There are always assumptions built into many of the items on these statements that, if changed, can have greater or lesser effects on the company’s bottom line and/or apparent health. This article looks at how assumptions in depreciation impact the value of long-term assets and how this can affect short-term earnings results.
|
Scooped by
Peter John Baskerville
onto Basic Accounting Concepts June 7, 2013 6:44 AM
|