A manager in a company reporting under U.S. GAAP complained about the amount of depreciation charged on

Question:

A manager in a company reporting under U.S. complained about the amount of depreciation charged on the plant for which she was responsible: “The market value of my plant just continues to increase, yet I am hit with large depreciation charges on my income statement and the value of my plant and equipment on the goes down each year. This doesn’t seem fair.” Comment on this statement, focusing on the relation of asset values on the to market values of the assets.

GAAP
Generally Accepted Accounting Principles (GAAP) is the accounting standard adopted by the U.S. Securities and Exchange Commission (SEC). While the SEC previously stated that it intends to move from U.S. GAAP to the International Financial Reporting Standards (IFRS), the... Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...