The following accounting practices are in accord with generally accepted accounting principles. Identify all the accounting concepts and principles that form the basis for each accounting practice. More than one concept or principle may apply.

a. A fire destroyed the company garage after December \(31,19 \mathrm{X} 7\), but before the financial statements were published in early February 19X8. Although the fire loss is insured, reconstruction of the garage will disrupt the company's operations. This subsequent event will be reported in the 19X7 financial statements.

b. A paint company accounts for its operations by dividing the business into four separate units. This division enables the company to evaluate each unit apart from the others.

c. A theater company accrues employee salaries at year end even though the salaries will be paid during the first few days of the new year.

d. Assets are reported at liquidation value on the financial statements of a company that is going out of business.

e. The cost of machinery is being depreciated over a five-year life because independent engineers believe the machinery will become obsolete after that time. (The company had hoped to depreciate the machinery over 10 years to report lower depreciation and higher net income in the early years of the asset's life.)

f. A manufacturing firm built some specialized equipment for its own use. The equipment would have cost \(\$ 110,000\) if purchased from an outside company, but the cost of constructing the equipment was only \(\$ 89,000\). The firm recorded the equipment at cost of \(\$ 89,000\).

g. Depreciation of the home-office building is difficult to relate to particular sales. Therefore, the company records depreciation expense on a time basis.

h. A company wishes to change its method of accounting for revenue. However, the company does not switch because it wants to use the same accounting method that other companies in the industry use.
i. Because it is often difficult to collect installment receivables, a realtor uses the installment method of revenue recognition rather than the sales method.
j. The cost of office equipment such as staplers and wastebaskets is not capitalized and depreciated because of their relative insignificance.