The three types of accounting changes, including error correction, are: Code Change in accounting policy. Change in accounting estimate. Error correction. Required: Following are a series of situations. You are to enter a code letter to the left to indicate the type of change. _____ 1. Change due to understatement of inventory. _____ 2. Change due to charging a new asset directly to an expense account. _____ 3. Change from expensing to capitalizing certain costs, due to a change in periods benefited. _____ 4. Change from FIFO to average-cost inventory procedures. _____ 5. Change due to failure to recognize an accrued (uncollected) revenue. _____ 6. Change in amortization period for an intangible asset. _____ 7. Change in expected recovery of an account receivable. _____ 8. Change in the loss rate on warranty costs. _____ 9. Change due to failure to recognize and accrue income. _____ 10. Change in residual value of a depreciable plant asset. _____ 11. Change from an unacceptable to an acceptable accounting policy. _____ 12. Change in both estimate and acceptable accounting policies. _____ 13. Change due to failure to recognize a prepaid asset. _____ 14. Change from straight-line to sum-of-the-years'-digits method of depreciation. _____ 15. Change in life of a depreciable plant asset. _____ 16. Change from one acceptable policy to another acceptable policy.
- The three types of accounting changes, including error correction, are:
Code
- Change in accounting policy.
- Change in accounting estimate.
- Error correction.
Required: Following are a series of situations. You are to enter a code letter to the left to indicate the type of change.
_____ 1. Change due to understatement of inventory.
_____ 2. Change due to charging a new asset directly to an expense account.
_____ 3. Change from expensing to capitalizing certain costs, due to a change in periods benefited.
_____ 4. Change from FIFO to average-cost inventory procedures.
_____ 5. Change due to failure to recognize an accrued (uncollected) revenue.
_____ 6. Change in amortization period for an intangible asset.
_____ 7. Change in expected recovery of an
_____ 8. Change in the loss rate on warranty costs.
_____ 9. Change due to failure to recognize and accrue income.
_____ 10. Change in residual value of a
_____ 11. Change from an unacceptable to an acceptable accounting policy.
_____ 12. Change in both estimate and acceptable accounting policies.
_____ 13. Change due to failure to recognize a prepaid asset.
_____ 14. Change from straight-line to sum-of-the-years'-digits method of depreciation.
_____ 15. Change in life of a depreciable plant asset.
_____ 16. Change from one acceptable policy to another acceptable policy.
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