[Verse 1] When you buy a building or machine for your company Record it at cost, that's how it starts historically Depreciation takes it down as years go passing by But there's another way to show what assets are worth, let's try [Chorus] Cost model keeps it simple, historical and true Revaluation model shows the current value too Cost stays steady, revaluation moves around Balance sheet and ratios change with what you've found Choose your model, stick with it consistently Cost or fair value, that's the key [Verse 2] Cost model is straightforward, purchase price minus wear Accumulated depreciation, systematic and fair But markets change and values rise, the book might show too low That's when revaluation helps the real worth to show [Chorus] Cost model keeps it simple, historical and true Revaluation model shows the current value too Cost stays steady, revaluation moves around Balance sheet and ratios change with what you've found Choose your model, stick with it consistently Cost or fair value, that's the key [Bridge] Revaluation surplus goes to equity's side If values drop below cost, expense cannot hide Return on assets changes when the base gets large Debt to equity shifts with revaluation's charge [Verse 3] Analysts must understand which method companies use Cost model shows stability, revaluation gives clues About the current market worth but adds volatility Compare the firms with care to see reality [Final Chorus] Cost model keeps it simple, historical and true Revaluation model shows the current value too Cost stays steady, revaluation moves around Balance sheet and ratios change with what you've found Choose your model, stick with it consistently Cost or fair value, now you see! [Outro] Property, plant, equipment too Two models help accounting through Cost or revaluation's way Learn them both, you'll use them every day
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