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At one time, Boeing closed a giant deal to acqire another manufacturer, McDonnell Douglas. Boeing paid for the acquisition by issuing shares of its own stock to the stockholders of McDonnell Douglas. In order for the deal to not be revoked, the value of Boeing's stock couldn ot decline below a certian level for a number of months after the deal. During the first half of the year, Boeing suffered significant cost overrunns because of inefficieinces in its production methods.Had these problems been disclosed in the quarterly financial statements during the first and second quarters of the year, the company's stock most likely would have plummeted, and the deal would have been revoked. Company managers spent considerable time debating when the bad news should be disclosed. One public relations manger suggested that the company's problems be reveled on the date of either Princess Diana's or Mother Teresa's funeral, in the hope that it wold be lost among those big stories that day. Instead, the company waited until October 22 of that year to annonce a $2.6 billion write-off due to cost overruns. Within one week, the company's stock price had fallen 20%, but by this time the McDonnell Douglas deal could not be reversed. Anwser the following questions:

What assumptions or priniciples of accounting are relevant to this case?

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