South Korea- based consumer electronics giant Samsung was accused by analysts of aggressively writing off some assets in the first quarter of 2019 to minimize its profits. Korea News Plus reported that the company engaged in "big bath" accounting (taking a large loss in an already-down time period). The company denied overstating the losses. Interestingly, in 2008 analysts accused the company of the same practice. In that year, the Korea Times reported that Samsung posted an operating loss much larger than was expected.

INSTRUCTIONS:
What future advantage might a company seek by booking even larger losses in an already weak quarter? How might readers of financial statements react when a company has been accused of "big bath" accounting more than once? How would a large asset write-off immediately affect the income statement, balance sheet and statement of cash flows?