Diversified Systems, Inc

question 29

Multiple Choice

Diversified Systems, Inc. this year reports consolidated financial statements in place of statements of individual companies reported in previous years. This results in

• A)An accounting change that should be reported prospectively.
• B)An accounting change that should be reported by restating the financial statements of all prior periods presented.
• C)A correction of an error.
• D)Neither an accounting change nor a correction of an error.This is a change in reporting entity to be accounted for retrospectively.That is, financial statements of prior periods are restated to report the financial information for the new reporting entity in all periods.

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Definitions:

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Visuals

Graphic elements such as diagrams, graphs, photographs, and videos that are used to support or convey information.

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The importance or meaning of something, especially in terms of its impact or relevance.

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