Question 2 Submit your ANSWERS in the Dropbox. Question 2 a. Mr. Arnold, the newly appointed CEO of your firm has very little accounting knowledge. One day he walked into your office and said, Three years ago we bought a piece of land for RM100,000. The current price of the land now is around RM125,000 but in our balance sheet it is still disclosed at the purchase price". Respond to this statement with specific reference to the accounting policies. (4 marks) b. Zebra Company has incurred substantial financial losses in recent years. Because of its financial condition, the ability of the company to keep operating is in question. Management prepares a set of financial statement that conform to Generally Accepted Accounting Principles. Comment on the use of GAAP under these conditions. (4 marks) c. A company may choose between the use of accrual basis or cash basis in recording their accounting transactions. Comment. (2 marks) Total 20 Marks