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  3. 3. the hc method, which uses unadjusted historical

3. The HC method, which uses unadjusted historical costs, doesnot consider depreciation expenses, purchasing...

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Accounting

3. The HC method, which uses unadjusted historical costs, doesnot consider depreciation expenses, purchasing power, andunrealized gains in replacement value. Despite these weaknesses asa financial reporting method, the HC method is used more frequentlyfor accounting purposes than other methods, such as the HC-GPL, CV,and CV-GPL methods. Why is this so?

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Accounting is concerned with past events and it requires consistency and comparability that is why it requires the accounting transactions to be recorded at their historical costs This is called historical cost concept Historical cost is the value of a resource given up or a liability incurred to acquire an assetservice at the time when the resource was given up or the liability incurred    See Answer
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In: Accounting3. The HC method, which uses unadjusted historical costs, doesnot consider depreciation expenses, purchasing power,...3. The HC method, which uses unadjusted historical costs, doesnot consider depreciation expenses, purchasing power, andunrealized gains in replacement value. Despite these weaknesses asa financial reporting method, the HC method is used more frequentlyfor accounting purposes than other methods, such as the HC-GPL, CV,and CV-GPL methods. Why is this so?

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