Redeau Company Has Been Depreciating Certain Assets Using the Straight-Line

question 6

Multiple Choice

Redeau Company has been depreciating certain assets using the straight-line method.At the beginning of the current year, the company changed to the sum-of-the-years'-digits method to depreciate these assets.Which of the following statements regarding this change is true?

• A)The change should be accounted for prospectively.
• B)The change should be accounted for with an adjustment of the accumulated depreciation and the retained earnings balances.
• C)The change should be accounted for by including the cumulative effect of the change in the current year's income statement.
• D)The accounting impact of the change is limited to the difference in current-year depreciation on the affected assets.

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Definitions:

Null Hypothesis

A theory proposing that there's no meaningful statistical distinction between the two variables under consideration in the hypothesis.

Rejection Region

The area in a statistical test's distribution which, if the test statistic falls within, leads to the rejection of the null hypothesis.

Standard Deviation

An index showing the degree of spread or deviation from the mean within a data collection.

Confidence Level

The probability, expressed as a percentage, that the calculated confidence interval actually includes the true population parameter.