Home Volumul 2 CASE STUDY ON RE-ADJUSTMENTS DEPENDING ON PRICE MODIFICATION

CASE STUDY ON RE-ADJUSTMENTS DEPENDING ON PRICE MODIFICATION


Cozma Ighian Diana
Universitatea de Nord Baia Mare, Str. Dr. Victor Babes, nr 62 / A, 430083 Baia Mare,
jud. Maramures, Telefon: 0262-218922, Fax: 0262-276153
Abstract
Inflationary moments, characterized by significant price rises, have proved that accounting
systems based on historical costs provide a distorted image of the reality: the elements of
the balance sheet are under-valuated, and the stock-related expenses and amortization in the
profit and loss account are also under-valuated. Under these circumstances, the result is
over-valuated, and its distribution leads to allotments from the company’s capital. In this
paper we draw up a case study with regards to the methods used for adjusting price
modification, clearly outlining, through a comparative analysis, the main differences
between the accounting system based on historical cost and inflation accounting.
Key words: accounting system; financial statements; prices; inflation.

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