A Company That Switches from Straight-Line Amortization to Double-Declining-Balance Amortization

question 32

Multiple Choice

A company that switches from straight-line amortization to double-declining-balance amortization during an accounting period must report this change on the financial statements as:

• A) an extraordinary item
• B) income from continuing operations
• C) a prior-period adjustment
• D) a cumulative effect of a change in accounting principle

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Definitions:

World Bank

A global economic institution that facilitates the growth of less developed nations by providing their governments with loans and grants for large-scale infrastructure projects.

Economic Development

The process by which the economic well-being and quality of life of a nation, region, or local community are improved.

Developing Economy

An economy with a low level of material well-being, often characterized by low income, inequality, poor health outcomes, and inadequate education systems.

Agriculture

The practice of cultivating the soil, growing crops, and raising livestock for human use and consumption.