What are the pros and cons for depreciation costs

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Depreciation costs in traditional financial statements are based on the original costs of the equipment. This arguably understates or overstates the actual amount of outlays that will be needed to replace the equipment. Should depreciation charges be restated to reflect the replacement costs for the equipment?

Question 1: What might some of the pros and cons (5 each) can be related to this topic.

Question 2: What the basic issues are and why this is a topic worth reading and thinking about?

Reference no: EM132644522

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