Assignment
INSTRUCTIONS: Provide 250 word ORIGINAL responses to each of the two topics. Make sure work is original and cite your sources.
Topic #1: Reciprocity?
When dealing with a continued consolidation, there are several issues to consider. The first issue is dealing with the concept of reciprocity. consider the following questions:
• Does the same team of accountants create the traditional financial statements that do the consolidation?
• When the consolidation adjustments are made where are the adjustments recorded?
• Who keeps track of these adjustments?
Topic #2: Fair Value?
Topic 2: Under traditional accounting methodology, historical cost is the accounting evaluation tool. However, when consolidations are implemented, the fair market value is used. Consider the following questions:
• Why is it important that consolidations prescribe to fair value?
• When is the adjustment made?
• How often is the adjustment recalculated?
• How are the adjustments kept?
• Respond per your Syllabus guidelines.