For each of the following situations, identify whether a change in accounting estimate, change in accounting policy, or an accounting error has occurred. Also indicate whether the change or correction should be made prospectively or retrospectively. The accounting clerk did not record a shipment of product on the last day of the previous fiscal year, because the customer had not yet paid for the product. The shipment was made FOB shipping point. In the past, Uni-Focus Company used the cash basis of accounting. This year, the Company is changing to the accrual basis of accounting. Tri-Facet Ltd follows ASPE. Management of Tri-Facet decided to switch from using the taxes payable method to using the future income tax method.
For each of the following situations, identify whether a change in accounting estimate, change in accounting policy, or an accounting error has occurred. Also indicate whether the change or correction should be made prospectively or retrospectively. The accounting clerk did not record a shipment of product on the last day of the previous fiscal year, because the customer had not yet paid for the product. The shipment was made FOB shipping point. In the past, Uni-Focus Company used the cash basis of accounting. This year, the Company is changing to the accrual basis of accounting. Tri-Facet Ltd follows ASPE. Management of Tri-Facet decided to switch from using the taxes payable method to using the future income tax method.
Financial Accounting Intro Concepts Meth/Uses
14th Edition
ISBN:9781285595047
Author:Weil
Publisher:Weil
Chapter8: Revenue Recognition, Receivables, And Advances From Customers
Section: Chapter Questions
Problem 26E
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For each of the following situations, identify whether a change in accounting estimate, change in accounting policy, or an accounting error has occurred. Also indicate whether the change or correction should be made prospectively or retrospectively.
- The accounting clerk did not record a shipment of product on the last day of the previous fiscal year, because the customer had not yet paid for the product. The shipment was made FOB shipping point.
- In the past, Uni-Focus Company used the cash basis of accounting. This year, the Company is changing to the accrual basis of accounting.
- Tri-Facet Ltd follows ASPE. Management of Tri-Facet decided to switch from using the taxes payable method to using the future income tax method.
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