Identify the type of accounting change that is described in each item, and indicate whether the prior years' financial statements mustbe restated when presented in comparative form with the current year's financial statements. Assume ASPE is followed.Assume that each item on the following list would have a material effect on the financial statements of a private enterprise in thecurrent year:1.2.A change to the income taxespayable method from thefuture income taxes method4.A change in the estimateduseful life of previouslyrecorded capital assets wherethe straight-line depreciationmethod is used3. A change from deferring andamortizing development coststo immediate recognition ofdevelopment costs as expense;the change to immediaterecognition arises because thecompany does not have theresources to market the newproduct adequatelyA change from including theemployer share of CanadaPension Plan and EmploymentInsurance premiums as aseparate payroll tax expense toincluding them with salariesand wages expense on theincome statementType of ChangeChange in accounting estimateChange in accounting estimateChange in accounting estimateChange in accounting policyRestatement of PriorYears in comparativeFinancial StatementsNoNoNoYes

When a company requires to sacrifice the consistent accounting methods and procedures, to enhance…

Identify the type of accounting change that is described in each item, and indicate whether the prior years' financial statements must be restated when presented in comparative form with the current year's financial statements. Assume ASPE is followed. Assume that each item on the following list would have a material effect on the financial statements of a private enterprise in the current year:

Identify the type of accounting change that is described in each item, and indicate whether the prior years' financial statements must be restated when presented in comparative form with the current year's financial statements. Assume ASPE is followed. Assume that each item on the following list would have a material effect on the financial statements of a private enterprise in the current year:

FINANCIAL ACCOUNTING

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Chapter1: Financial Statements And Business Decisions

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Question

Identify the type of accounting change that is described in each item, and indicate whether the prior years' financial statements must
be restated when presented in comparative form with the current year's financial statements. Assume ASPE is followed.
Assume that each item on the following list would have a material effect on the financial statements of a private enterprise in the
current year:
1.
2.
A change to the income taxes
payable method from the
future income taxes method
4.
A change in the estimated
useful life of previously
recorded capital assets where
the straight-line depreciation
method is used
3. A change from deferring and
amortizing development costs
to immediate recognition of
development costs as expense;
the change to immediate
recognition arises because the
company does not have the
resources to market the new
product adequately
A change from including the
employer share of Canada
Pension Plan and Employment
Insurance premiums as a
separate payroll tax expense to
including them with salaries
and wages expense on the
income statement
Type of Change
Change in accounting estimate
Change in accounting estimate
Change in accounting estimate
Change in accounting policy
Restatement of Prior
Years in comparative
Financial Statements
No
No
No
Yes

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