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Fro From The M & O Railroad Essay

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The AICPA (American institute of Certified Public Accountants) identified that most corporations increased using fund statements in their annual report. The theme of the use of fund statements is creating confusion when it came to preparing and interpreting them in the annual reports. The fund statements have been used over the past 100 years and have been incorporated in today’s practices . They are supposed to report all the items that have not been disclosed by the balance sheet, retained earnings statement, and the income statement. This means all changes in the form of liquidity; inter-entity transactions, and any form of different perspectives is reported. I think in order to avoid all the confusion and compromises in companies and organizations, accountants should request for the adoption of two or more reports to be used instead of the funds statement. …show more content…

Unfortunately, the railway’s financial and organizational structure was negatively affected by the commencement of the war . The company suffered the destruction of its rails, warehouses and other assets which meant that it had to go back into its profits to revive itself again. The company was lucky s its rolling stock was still bringing in some profit and was able to keep the company afloat. The war seemed to cost the company a lot of money due to the purchase of new locomotives and high costs of repair of the railroads, warehouses, and other assets. It is understandable that the company had to have high rates for its services, but that was to balance the books due to the high cost of labor, materials, and railroad maintenance. At the end, it is business and both positive growth and profits should be set and

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