(Applying accounting assumptions, characteristics, and measurement conventions, LO 2, 3, 4) What accounting assumption, characteristic, or measurement con- vention would Pilger Ltd. (Pilger) use to justify the following accounting treatments for the year ended June 30, 2004?

a. Pilger writes down capital assets to their net realizable value if the net realizable value is less than the cost of the asset.

b. Pilger discloses in the notes to the financial statements the fact that a fire destroyed a major production facility in July 2004. The effect of the fire is not recorded in Pilger’s financial statements for the year ended June 30, 2004. . Pilger records the purchase of inventory at the amount of money it paid.

d. Pilger expenses the cost of inventory when the inventory is sold to a customer and the revenue is recognized.

e. Pilger allocates the cost of its amortizable assets over the estimated life that Pilger expects the asset to contribute to earning revenue.