Depreciation, Amortization, And Impairment

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The Framework for Financial Reporting
Accounting Judgements
Statements of Income and Comprehensive Income
Statements of Financial Position and Changes in Equity; Disclosure Notes
The Statement of Cash Flows
Revenue Recognition
Financial Assets: Cash and Receivables
Cost-Based Inventories and Cost of Sales
Long-Lived Assets
Depreciation, Amortization, and Impairment
Financial Instruments: Investments in Bonds and Equity Securities

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Question 1

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A change from inventory costing using FIFO to inventory costing using Weighted Average is an example of a change in accounting principle.

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Question 2

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Revised estimates of the useful life or residual value of a depreciable asset are examples of a change in accounting principle.

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Question 3

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A change,for depreciation purposes,of either estimated useful life or estimated residual value usually is referred to as a change in accounting estimate.

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Question 4

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Accounting policy changes are only justifiable when there is a change to a primary source of GAAP.

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Question 5

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Accounting policy changes must always be handled retrospectively.

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Question 6

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The failure to expense a prepaid asset is an example of a counterbalancing error.

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Question 7

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Accounting changes reported by using the current approach,require that the "catch-up adjustment" include the effect on earnings in the year of the change.

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Question 8

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If a change in estimate and a change in principal occur on the same item and at the same time,the one that is dominant is reported.

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Question 9

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Changes in accounting policy are always voluntary in nature.

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Question 10

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A change in the useful life of an asset requires an accounting estimate change,which affects only periods after the change,is made.

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Question 11

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When an asset's residual value estimate is changed,the entire depreciation schedule for the asset is recomputed all the way back to the date of acquisition.

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Question 12

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A change in policy mandated by a change of standard under IFRS is an example of a mandatory policy change.

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Question 13

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If a corporation changes from reporting investments on the cost basis to reporting on the equity basis,the prospective approach of reporting must be used.

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Question 14

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Some changes in accounting principle must be reported by using the retrospective approach.

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Question 15

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A change from a non-GAAP procedure to a GAAP procedure usually is referred to as a change in accounting principle.

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Question 16

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A change,for depreciation purposes,of either estimated useful life or from one GAAP to another GAAP accounting method,usually is referred to as a change in accounting principle.

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Question 17

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A change in accounting principle occurs when a company adopts a principle that is different from a previously used principle that is also generally accepted.

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Question 18

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Most changes in accounting principle are recognized by using the current approach.

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Question 19

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A voluntary change in accounting policy is only justifiable when it results information that is both more reliable and more relevant.

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Question 20

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A change in accounting principle occurs when a company adopts a principle different from an approved principle previously used.

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