When the Estimate of an Asset's Useful Life Is Changed

question 4

Multiple Choice

When the estimate of an asset's useful life is changed,

• A) depreciation expense for all past periods must be recalculated.
• B) there is no change in the amount of depreciation expense recorded for future years.
• C) only the depreciation expense in the remaining years is changed.
• D) None of these are true.

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Definitions:

Conservative Decision

A decision-making approach that involves choosing options that have the least potential for negative outcomes or risks, preferring safety and stability.

Complex Problems

Issues or challenges that are multi-faceted, involving numerous variables, and are difficult to understand or solve.

Homogeneous Teams

Groups consisting of members with similar backgrounds, skills, and perspectives, which can lead to more harmonious operations but may lack diversity in thought.

Team Experience

The collective knowledge, skills, and interpersonal dynamics that shape how a team performs and operates.