Financial Reporting and Analysis Week 2 Assignment Harnischfeger Case - 1

financial Reporting and Analysis Week 2 Harnischfeger Case - Assignment ExampleWith the coming in of the straight-line method acting for financial reporting which is a change that has built on the preliminaryly used method which was the primarily accelerated method, some level of changes have been recorded on the income of the company. Even though it is described to be insignificant, there has been an upsurge in the reported income of the company by $11.0 million. Into the future, this change will only assume wage positively when the company is able to maintain its current expenditure or is able to financial backing that also lower than it currently stand (Cao, 2009).The accounting changes that were recorded also affected changes in the dispraise lives, which focused on specific areas of the companys operations. These included U.S set ups, machinery and equipment and residual values on selected items. The piece of this was an increase in net income by $3.2 million for 1984 al one. In the most immediate future, reported profits are expected to go up as a result of this. However, Conrad (2009) also observe that increase income can only be likened to guaranteed profits if expenditure is also low.The current economic assumptions that Harnischfegers plant and machinery will last longer and only lose their value slowly can be noted to be justified. This is because of a number of reasons. In the first place, most of the challenges that the business was facing as activate of its business conditions in the primary industries are no more. Secondly, the depreciation accounting will now project that there is less pressure on plant and machinery, giving room for the lifespan of these to last longer.last in first out voiding is simply a method of inventory costing that states for last in, first out. LIFO liquidation is noted to take place in situations where current sales are noted to be higher(prenominal) than current purchases, leading to the need to liquidate a ll inventory that were not sold in the previous periods (Hull and White, 2010). The effect of LIFO liquidation on income