Which is a change in accounting policy? A. The initial adoption of an accounting policy to carry asset at revalued amount B. The change from cost model to revaluation model in measuring property, plant and equipment C. A change in the measurement basis D. All of the choices are considered change in accounting policy

Which is a change in accounting policy? A. The initial adoption of an accounting policy to carry asset at revalued amount B. The change from cost model to revaluation model in measuring property, plant and equipment C. A change in the measurement basis D. All of the choices are considered change in accounting policy

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter22: Accounting For Changes And Errors.

Section: Chapter Questions

Problem 4MC: A change in the expected service life of an asset arising because additional information has been...

See similar textbooks

Similar questions

What are the effects of the following transactions on the accounting equation? Indicate an increase (+) or decrease () under the affected asset, liability, and owners equity headings.
Which of the following terms is used when assuming a business will continue to operate in the foreseeable future? A. separate entity concept B. monetary measurement concept C. going concern assumption D. time period assumption
Match the correct term with its definition. A. cost principle i. if uncertainty in a potential financial estimate, a company should err on the side of caution and report the most conservative amount B. full disclosure principle ii. also known as the historical cost principle, states that everything the company owns or controls (assets) must be recorded at their value at the date of acquisition C. separate iii. (also referred to as the matching principle) matches expenses with associated revenues in the period in which the revenues were generated. D. monetary iv. business must report any business activities that could affect what is reported on the financial statements E. conservatism v. system of using a monetary unit by which to value the transaction, such as the US dollar. F. revenue vi. period of time in which you performed the service or gave the customer the product is the period in which revenue is recognized. G. expense vii. business may only report activities on financial statements that are specifically related to company operations, not those activities that affect the owner personally.
What is the impact on the accounting equation when a sale occurs? A. both sides increase B. both sides decrease C. only the Asset side changes D. neither side changes
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
When it is probably that future economic benefits associated with an asset will flow to the entity, and the costs can be reliably measured, it should be recognised as an asset. A change in depreciation method is a. a) Change in accounting standard b) Change in accounting policy c) Change in accounting estimate d) Change in accounting method
Which of the following should be treated as a change in accounting policy? A change is made in the method of calculating the provision for uncollectible accounts receivable A change from cost model to fair value model in measuring investment property An entity engaging in construction contract for the first time needs on accounting policy to deal with this All of the choices qualify as a change in accounting policy
An analyst must be familiar with the determination of income. Income reported for a business entity depends on proper recognition of revenues and expenses. In certain cases, costs are recog- nized as expenses at the time of product sale; in other situations, guidelines are applied in capi- talizing costs and recognizing them as expenses in future periods. Required: a. Under what circumstances is it appropriate to capitalize a cost as an asset instead of expensing it? Explain. b. Certain expenses are assigned to specific accounting periods on the basis of systematic and rational allocation of asset cost. Explain the rationale for recognizing expenses on such a basis.
Which of the following should be treated as a change in accountingpolicy? A. A change is made in the method of calculating the provision for uncollectible accounts receivable B. A change from cost model to fair value model in measuring investment property C. An entity engaging in construction contract for the first time needs on accounting policy to deal with this D. All of the choices qualify as a change in accounting policy
An example of a correction of an error in previously issued financial statements is a change Question 2Select one: in the service life of plant assets, based on changes in the economic environment. in the tax assessment related to a prior period. from the cash basis of accounting to the accrual basis of accounting. from the FIFO method of inventory valuation to the LIFO method.
) A company has decided to change its depreciation method to better reflect the pattern of use ofits equipment.Which of the following correctly reflects what this change represents and how it should beapplied?A It is a change of accounting policy and must be applied prospectivelyB It is a change of accounting policy and must be applied retrospectivelyC It is a change of accounting estimate and must be applied retrospectivelyD It is a change of accounting estimate and must be applied prospectively
Explain is a change in depreciation method a change in accounting principle, or is it a change in estimate?