XYZ Company bought real estate properties in Boston 50 years ago for $30,000. In 2020, a real
Estate appraiser inspects the properties and concludes that their expected market value is $2 million
The company has been using historical accounting principles for the last 50 years. A newly appointed
Financial manager recommends the use of fair value accounting for the value of the properties.
Discuss the difference between the two approaches. Do you agree with the financial manager? Why
Or why not?
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XYZ Company bought real estate properties in Boston 50 years ago for $30,000. In 2020, a real
Estate appraiser inspects the properties and concludes that their expected market value is $2 million
The company has been using historical accounting principles for the last 50 years. A newly appointed
Financial manager recommends the use of fair value accounting for the value of the properties.
Discuss the difference between the two approaches. Do you agree with the financial manager? Why
Or why not?
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