Which of the Following Statements Is True with Respect to Financial

question 188

Multiple Choice

Which of the following statements is true with respect to financial statement reporting a change in accounting principle?

• A) Comparability across periods is impaired
• B) Only a footnote is required to report the change
• C) Changes in both depreciation methods and inventory methods are reported retroactively.
• D) Management must show that the new accounting principle is preferable to the old method.

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Definitions:

Fraud

A wrongful or criminal deception intended to result in financial or personal gain.

Authenticity

The quality of being genuine, original, or not a copy, often verified through evidence or certification.

Materially Different Meanings

Terms or phrases that have significantly divergent implications in different contexts or interpretations.

Interpretation

The process of explaining, defining, or clarifying the meaning of words, texts, or actions.