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These are discussion questions. They do not have to be overly complex.

 

Fair value accounting is a newer financial accounting concept in U.S. GAAP. Describe either an advantage or a disadvantage that you see in applying fair value to certain assets. Be sure to include an example.

 

Contrast variable and absorption costing and identify the advantages and disadvantages of each. If the units produced exceed unit sales, which method would you expect to show the higher net operating income, variable costing or absorption costing? Explain and justify your answer.

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