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Revaluation of Long-lived Assets. The Queensbury Corporation was founded in 1947 on a decommissioned
military installation that had been purchased from the U. S. government for a price of $1. Today, that same
land carries a fair market value of $70 million. Consistent with the historical cost principle, The Queensbury
Corporation continues to value the land at its original purchase price of $1 plus the cost of any improvements
(such as roadways, lights, and drainage) Discuss the financial statement problems created by the historical
cost principle for entities like The Queensbury Corporation that have significant investments in long-lived
appreciating assets (such as land), Should these companies be allowed to revalue these assets? Why? How
would a land revaluation be reflected in the financial statements?