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financial reporting that has more than one treatment

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Describe a transaction or set of transactions affecting a company you have worked for or that you are aware of that could arguably be presented in more than one way in the financial statements. What is the financial impact of the presentation selected?

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Solution Summary

Your response is 302 words and describes three types of transactions from the field that had different reporting possibilities and how that impacted the financial statements and disclosures.

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I have worked for three large firms. The transactions that seemed to be treated quite differently were small purchases (to expense or capitalize), the shipping charges to customers, and items that were reimbursed.

The small purchases such as tools, printers and such, that would clearly last for more than a year, should have been capitalized and depreciated. However, two of the firms did not do this. They had a "threshold" below which items, even if they were going to be used over many periods, ...

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Carol Sargent, PhD
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  • MSc, University of Virginia
  • PhD, Georgia State University
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