A Retrospective Adjustment Requires a Change in the

question 49

Multiple Choice

A retrospective adjustment requires a change in the

• A)prior period financial statements to look like the current period financial statements
• B)current period income to reflect the cumulative effect of new method
• C)prior period financial statements to reflect how they would have been presented had the new method been used in prior periods
• D)current period accounts in the financial statements to what they would have been had the previous method been used in the current period

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Definitions:

Operating Assets

Assets used by a business in its day-to-day operations to generate revenue, such as machinery, equipment, and inventory.

Maintenance Department

A department within an organization responsible for maintaining facilities, machinery, and equipment to ensure efficient operation.

Machine-hours

The total operational time recorded for machinery, often used in calculating production costs and efficiency.

Variable Cost

A cost that varies with the level of output or activity.