Question

Rigsby Company purchased many small tools during 2010 at a total cost of $9,500. Some tools were expected to last for a few weeks, some for several months, and slme for several years. Rigsby income for 2010 will be about $5.2 million. How should Rigsby account for the small tools in order to be theoretically correct? As a practical matter, how should Rigsby account for these tools? Why?

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