Reference no: EM133011210

The valuation of assets is basically just using the depreciation and accumulated depreciation accounts properly in order to give assets a value at their current state. There are other accounts that accountants use to assign value to assets such as property, plant, and equipment. These accounts are trade-in allowances, loss on disposal, book value, fair value, and book value gone up. Most of the time when it comes to equipment, the accountant does journal entries in order to decrease the value of the asset. However, when it comes to property and sometimes plant, the value of the assets could go up over time. We have seen the value of land go up a crazy amount this past year so would bet that accountants were tasked with increasing the value of their property to be reflected in the books. Under no circumstances would it be ethical for an accountant to use estimates and varying methodology to achieve desired corporate results because that is simply unfair. This would be the same as an accountant saying that the company has an extra $10,000 in cash than they really have. Accountants are tasked with delivering the truth when creating financial statements according to GAAP.

Problem 1: What advice or example can you give to this?