Which of the Following Would Be Treated as a Prior

question 102

Multiple Choice

Which of the following would be treated as a prior period adjustment by Gold Corporation in 2010?

• A) In 2010, it was discovered that Gold Corporation recorded the purchase of a warehouse in 2007 as a debit to Repairs Expense.
• B) In 2010, Gold Corporation switched from the straight-line method of depreciation to another method of computing depreciation.
• C) In 2010, Gold Corporation's management decided that the estimated useful life of its computer equipment should be changed from five years to nine years.
• D) In 2010, Gold Corporation sold a segment of the business that it has operated since 1996.

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Definitions:

Machine Hour

A measurement of production time, counting one hour of operation of a machine or a piece of equipment for manufacturing purposes.

Sales Margin

The difference between the selling price of a product and the cost of goods sold, expressed as a percentage of sales, indicating the profitability of a product.

Fixed Costs

Expenses that do not change with the level of output or sales, such as rent, salaries, and insurance premiums.

Product Mix

This term represents the complete range of items that a business has available for sale, highlighting diversity in product offerings.