If there is a change from double declining balance to straight line method xThe accumulated depreciation is adjusted to its appropriate balance through retained earnings based on the straight-line method xThe accumulated depreciation is not adjusted but the remaining carrying amount is allocated over the remaining life using the straight-line method xThe accumulated depreciation is adjusted to its appropriate balance through net income based on the straight-line method xThe accumulated depreciation is not adjusted but the remaining carrying amount is allocated over the original life using the straight-line method

If there is a change from double declining balance to straight line method xThe accumulated depreciation is adjusted to its appropriate balance through retained earnings based on the straight-line method xThe accumulated depreciation is not adjusted but the remaining carrying amount is allocated over the remaining life using the straight-line method xThe accumulated depreciation is adjusted to its appropriate balance through net income based on the straight-line method xThe accumulated depreciation is not adjusted but the remaining carrying amount is allocated over the original life using the straight-line method

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter4: The Adjustment Process

Section: Chapter Questions

Problem 9MC: If an adjustment includes an entry to Accumulated Depreciation, which type of adjustment is it? A....

See similar textbooks

Similar questions

Which of the following would appear as a prior period adjustment? Group of answer choices a correction in the calculation of earnings per share of a prior period a material difference between the actual and estimated uncollectible accounts receivable a material loss resulting from the sale of fixed assets which were acquired in a prior period material error in the computation of depreciation expense in the Year 1 that was discovered and corrected in the Year 3
For financial accounting purposes, depreciation expense represents the decreasein an asset's fair market value. Select one: True False The total amount of depreciation taken over the life of a depreciable asset should be less if the double-declining balance depreciation method is used than if the straight-line method is used. Select one: True False
When a company changes from the straight-line method of depreciation for previously recorded assets to the double declining balance method, which of the following should be reported?Cumulative effects of change in accounting principle, Pro forma effects of retroactive applicationa. No Nob. No Yesc. Yes Yesd. Yes No
An impairment loss for long-lived assets which are to be held and used should be reported on the income statement as a(n) a. Extraordinary item . b. Component of the income or loss from the operations of a discontinued segment. c. Cumulative effect of a change in accounting principle . d. Component of income from continuing operations before income taxes.
How does the adjustment for depreciation differ from other deferral adjustments? Multiple Choice The depreciation adjustment results in an increase to a long-lived asset account, while the other deferral accounts References The depreciation adjustment uses a contra-asset account rather than reducing the asset account directly The depreciation adjustment increases a liability account rather than reducing an asset account directly The depreciation adjustment is not a deferral adjustment, but rather on accrual adjustment.
If a P2,500 adjustment for depreciation is omitted, which of the following financial statement errors will occur? a. profit will be understated c. expenses will be overstated b. assets will be understated d. owner's equity will be overstated
A change from the straight-line method of depreciation to sum-of-years' digits is accounted for as a. change in accounting estimate b. prior period error c. accounting error d. change in accounting policy
Accumulated depreciation is record on the balance sheet as ___? A. A reduction in corresponding liability B. A reduction to the corresponding asset C. An increase in the corresponding liability D. An increase in the corresponding asset
Which of the following would NOT be reflected in the income statement? Group of answer choices A.Correction of an error in previously issued financial statements B.Loss on disposal of a segment of a business C.Cumulative effect of a change in depreciation methods D.An extraordinary item
Which of the following is accounted for as a change in accounting policy? A. A change in the estimated useful life of property, plant and equipmentB. A change from cash basis to accrual basis of accountingC. A change from expensing immaterial expenditures to deferring and amortizing them when material.D. A change in inventory valuation from FIFO to average method
Complete the worsheet one section at a time, beginning with the Adjustments columns. For the Adjustments columns use the appropriate letters a. through d. as posting references. For the Income Statement and Balance Sheet columns, remember to include the net income or loss after the totals and then total the columns again. (If a box is not used in the worksheet, leave the box empty; do not enter a zero. Abbreviations used: Acc. = Acccumulated; Adj. = Adjusted; Depr. = Depreciation; Stmt. = Statement.) Mullen Co. Worksheet For Year Ended December 31, 201X Trial Balance Adjustments Account Dr. Cr. Dr. Cr. Cash 7 Accounts Receivable 3 Merchandise Inventory 9 Store Supplies 7 Store Equipment 20 Acc. Depr., Store Equipment…
Which of the following statements is correct? Options: • The net income would still be the same regardless of accounting method that is used whether cash basis or accrual basis • Pre-collections initially recorded as income will overstate the profit at the end of the accounting period if no adjustment is done for unearned portion • Deferral is intended to recognize income earned but not yet received • Accrual of expenses will increase the expense element and will correspondingly decrease the liability