Why is it important that we use the accounting practice of

Reference no: EM13567604

Why is it important that we use the accounting practice of capitalizing major asset acquisitions of items with multiple-year useful lives and then depreciating them over time? How does this improve valuation of the business on the balance sheet and ensure compliance with the matching principle on the income statement (a) when the asset is acquired, (b) in one of the middle years of use of an asset with a multi-year life, and (3) when the asset is eventually disposed of via sale to an outside party.

Reference no: EM13567604

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