Which of the Following Statements Is True with Respect to a Financial

question 111

Multiple Choice

Which of the following statements is true with respect to a 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:

Regression Analysis

is a statistical method for investigating and modeling the relationship between variables.

Dependent Variable

The factor in a model or experiment predicted to vary as a result of modifications in the independent variables.

Seasonal Index

A measure that quantifies the predictable fluctuation in activity or values according to the season or time of the year.

Forecasted Sales

Predicted sales figures based on analysis of market trends, historical sales data, and other relevant factors, used by businesses for planning.