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Unformatted text preview: existing assets and is likely to show up eventually in poor financial results. It is important for a company to (1) keep assets in good operating condition, (2) replace worn-out or outdated assets, and (3) expand its productive assets as needed. The decline of rail travel in the United States can be traced in part to the failure of railroad companies to maintain and update their assets. Conversely, the growth of air travel in this country can be attributed in part to the general willingness of airline companies to follow these essential guidelines. For many companies, investments in plant assets are substantial. Illustration 9-1 shows the percentages of plant assets in relation to total assets in various companies. Illustration 9-1 Percentages of plant assets in relation to total assets...
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This note was uploaded on 11/08/2011 for the course ACCOUNTING ac 201 taught by Professor - during the Spring '11 term at Montgomery.
- Spring '11