Discussion Questions: Chapter 9 & 10 : Intermediate Accounting

Please answer each question individually in at least 120 words per.

1.    Why is it necessary to value inventories using the lower of cost or market concept?

2.    What costs should be capitalized when purchasing or constructing a building?

3.    How and why would you account for the impairment of fixed assets?

4.    What is the role of “boot” in the exchange of assets?

5.    Should companies manage fixed assets with the same level of rigor as inventory? Why or why not?