Which of the Following Is an Example of a Material

question 63

Multiple Choice

Which of the following is an example of a material accounting change that requires recognition in an unqualified opinion on the entity's financial statements?

• A)A change in the estimate of useful lives used to depreciate property, plant, and equipment.
• B)A change in the entity's form of reporting entity.
• C)Management has changed from one generally accepted accounting principle to another but has not provided reasonable justification.
• D)A change from an accounting principle that conforms with GAAP to one that does not.

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Definitions:

Unstructured Problems

Issues or challenges that lack a clear procedure or path for resolution, often requiring creative solutions.

Nonprogrammed Decisions

Decisions made in response to situations that are unique, poorly defined, and largely unstructured, often requiring creative solutions.

Programmed Decisions

Decisions that are routine and repetitive, often made using established guidelines or procedures.

Routine Problem

A common or regularly occurring problem that typically has a known and straightforward solution.