Prior Period Errors and Changes in Accounting Policy Create Gains

question 61

True/False

Prior period errors and changes in accounting policy create gains and losses that are accounted for in the period that the errors are discovered,or the change in policy made:

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Definitions:

Interest Accrue

The process by which interest is added to the principal sum of a loan or deposit, typically over time.

Instrument Due

This term refers to the date on which a financial instrument, such as a check or note, is payable.

Bearer

A person in the possession of an instrument payable to bearer or indorsed in blank.

Negotiable

Capable of being transferred or modified in terms of agreement or ownership through endorsement or delivery.