Marietta Corp. had the following reporting issues during the year:
1. Land with a cost of $208,000 that is intended to be used by the company as a building site was reported at its fair value of $260,000.
2. A surplus parcel of land with a cost of $150,000 intended for resale in the near future is reported at its fair value of $160,000.
3. The president of Marietta, Deanna Durnford, decided it wasn't necessary to classify assets and liabilities as current and non-current as she expects to operate the company only for another 10 years.
Instructions
For each of the above situations, identify (a) the assumption or principle involved, and (b) whether it is being followed correctly or has been violated.