Question
In 1981, USSC extended the useful lives of several of its fixed asset and adopted salvage values for many of these same assets for the
In 1981, USSC extended the useful lives of several of its fixed asset and adopted salvage values for many of these same assets for the first time. Are these changes permissible under generally accepted accounting principles? Assuming these changes had a material effect on USSCs financial condition and results of operations, how should the changes have been disclosed in the companys financial statements? How should these changes have affected Ernst & Whinneys 1981 audit opinion? (Assume that current audit reposting standards were in effect at the time.)
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