How differing accounting standards impact cost reimbursement

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In the article you will notice how differing accounting standards (GAAP vs. FAR) can impact cost reimbursement (Mcclure-Nelson, 2022). Consider the example of the contractor purchasing a building and making significant renovations. Get the instant assignment help. Under GAAP, these renovation costs are typically capitalized as part of the building's cost and depreciated over its useful life. However, the FAR may treat these costs differently, particularly if they fall below a certain threshold or are deemed "expenses" for reimbursement purposes.

Reference no: EM133921059

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