Which principle of accounting is being violated

Reference no: EM13134314

Much has been written about accounting the accounting fraud and subsequent bankrupt of world com. The baltimore sun reported that "the fraud was brazen and easy to spot. The scheme was not complicated: The companies financial officers recorded routine maintenance expenses totaling 3.9 billion as capital expenditures, which can be written off over decades rather than booked as immediate expense.

A.) Explain how capitalizing an item, instead of expensing it, affects the financial statements.

B.) Which principle of accounting is being violated? Are other principles involved?Discuss.

Reference no: EM13134314

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