A Change in the Estimated Useful Life and Residual Value

question 18

Multiple Choice

A change in the estimated useful life and residual value of machinery in the current year is handled as:

• A) A retrospective change back to the date of acquisition as though the current estimated life and residual value had been used all along.
• B) A prospective change from the current year through the remainder of its useful life, using the new estimates.
• C) A cumulative adjustment to income in the current year for the difference in depreciation under the new versus old estimates.
• D) All of these answer choices are incorrect.

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Definitions:

Acquiescent

Displaying agreement or compliance without protest or enthusiasm.

Incrementalism

Systematic progression of a relationship through each of the de-escalation stages.

Bilateral Dissolution

Refers to the mutual agreement between two parties to end or dissolve a relationship or agreement.

Unhappiness

A state of dissatisfaction or sadness, often resulting from unmet expectations or difficulties in one’s life or surroundings.