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Classifying accounting changes
• LO20–1 through LO20–5
Indicate with the appropriate letter the nature of each situation described below:
Type of Change
PR Change in principle reported retrospectively
PP Change in principle reported prospectively
E Change in estimate
EP Change in estimate resulting from a change in principle
R Change in reporting entity
N Not an accounting change
______ 1. Change from declining balance
______ 2. Change in the estimated useful life of office equipment
______ 3. Technological advance that renders worthless a patent with an unamortized cost of $45,000
______ 4. Change from determining lower of cost or net realizable value (LCNRV) for the inventories by the individual item approach to the aggregate approach
______ 5. Change from LIFO inventory costing to the weighted-average inventory costing
______ 6. Settling a lawsuit for less than the amount accrued previously as a loss contingency
______ 7. Including in the consolidated financial statements a subsidiary acquired several years earlier that was appropriately not included in previous years
______ 8. Change by a retail store from reporting warranty expense on a pay-as-you-go basis to estimating the expense in the period of sale
______ 9. A shift of certain
______ 10. Pension plan assets for a defined benefit pension plan achieving a
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INTERMEDIATE ACTG LOOSELEAF W/ ACCESS
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