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December 17, 2022

What is the importance of understanding various inventory valuation methods in determining the quality of reported profits?

DQ1 The Quality of Financial Information

Referencing this week’s readings and lecture, describe the quality issues related to reporting revenue. What is the importance of understanding various inventory valuation methods in determining the quality of reported profits?

DQ2 Conflicts with GAAP

Even though firms follow the accounting rules (GAAP) when presenting their financial statements, it is still possible for conflicts of interest to exist between what management wants investors and creditors to see and the economic reality of transactions. Explain how this can occur.

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