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Two retail businesses, A and B, have a similar trade in similar shops in similar areas. A purchased its store in 1950 for 5000 and
Two retail businesses, A and B, have a similar trade in similar shops in similar areas.
A purchased its store in 1950 for 5000 and B bought the store in 1990 for 105 000.
Both companies constantly prepare their accounts on principles of historical cost and have identical operating profit.
What extent resulting accounts give a true (and fair) representation of the relative performance of the two companies?
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