Problem:
Kobyashi Moru reports its inventory, fixed assets, depreciation and cost of goods sold on a current value basis (fair market value on the date of the financial statements).
Such accounting violates the cost principle of US GAAP. There is a disclosure of the pertinent facts stating this in a footnote on the key financial statements.
Required:
Question: Prepare the following paragraphs that include the appropriate language.
- A qualified opinion
- An adverse opinion
Note: Please show the work not just the answer.