Chapter 20, Problem 20.25E

Classifying accounting changes and errors

• LO20–1 through LO20–6

Type of Adjustment

A. Change in accounting principle (reported retrospectively)

B. Change in accounting principle (exception reported prospectively)

C. Change in estimate

D. Change in estimate resulting from a change in principle

E. Change in reporting entity

F. Correction of an error

_____ 1. Change from expensing extraordinary repairs to capitalizing the expenditures

_____ 2. Change in the residual value of machinery

_____ 3. Change from FIFO inventory costing to LIFO inventory costing

_____ 4. Change in the percentage used to determine warranty expense

_____ 5. Change from LIFO inventory costing to FIFO inventory costing

_____ 6. Change from reporting an investment by the equity method due to a reduction in the percentage of shares owned

_____ 7. Change in the composition of a group of firms reporting on a consolidated basis

_____ 8. Change from sum-of-the-years’-digits depreciation to straight-line

_____ 9. Change from FIFO inventory costing to average inventory costing

_____ 10. Change in actuarial assumptions for a defined benefit pension plan