A Change from the Straight-Line Method to the Sum-Of-Years'-Digits Method

question 15

Multiple Choice

A change from the straight-line method to the sum-of-years'-digits method of depreciation is handled as:

• A)A retrospective change back to the date of acquisition as though the current estimated life had been used all along.
• B)A cumulative adjustment to income in the current year for the difference in depreciation under the new vs.old useful life estimate.
• C)A prospective change from the current year through the remainder of its useful life.
• D)None of these is correct.

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Definitions:

Political Activities

Actions or undertakings aimed at influencing governmental policy or elections.

Given Industry

A specific sector of the economy, often defined by the type of activity it engages in.

Seniority Systems

Policies within organizations that determine the hierarchy, privileges, and benefits based on the length of service of employees.

Arbitrary Management

A style of management based on random decisions or personal whim, rather than any systematic planning or reasoning.