Item$12$

$8\mathrm{.}37$

points

Time Remaining $58$ minutes $38$ seconds$00$:$58$:$38$

eBookReferencesCheck my workCheck My Work button is now enabled$3$Item $12$

Time Remaining $58$ minutes $38$ seconds$00$:$58$:$38$

For each of the following situations, indicate whether you agree or disagree with the financial reporting practice employed and state the accounting concept applied $($if you agree$)$ or violated $($if you disagree$).$

A company adjusted the valuation of all assets and liabilities to reflect changes in the purchasing power of the dollar.

A company changed its method of accounting for natural resource exploration costs from successful efforts to full cost. No mention of the change was included in the financial statements. The change had a material effect on the company's financial statements.

A company purchased machinery having a five$-$year life. The cost of the machinery is being expensed over the life of the machinery.

A company purchased equipment for $$180,000$ at a liquidation sale of a competitor. Because the equipment was worth $$230,000,$ the company valued the equipment in its subsequent balance sheet at $$230,000.$

A company received a large order for the sale of $1,000$ parts at $$100$ each. The customer paid the company the entire amount of $$100,000$ on March $15.$ However, the company did not record any revenue until April $17,$ the date the parts were delivered to the customer.

A company purchased office supplies at a cost of $$32\mathrm{.}00.$ The cost of the office supplies was expensed even though the supplies had a three$-$year estimated useful life.

A company provides financial statements to external users every three years.