Which of the following is not a source of a prior-period adjustment?

A) a mathematical mistake
B) the incorrect use of existing facts
C) misuse of a generally accepted accounting principle
D) a change from using one GAAP estimate to another GAAP estimate

Question

Jalal Suhail · Accepted Answer

Final Answer : D, Explanation :  A prior-period adjustment is made when there is an error in the financial statements from a previous period. Choices A, B, and C all indicate errors that could result in a prior-period adjustment. However, a change from using one GAAP estimate to another GAAP estimate is not considered an error but a change in accounting estimate, which would be accounted for prospectively rather than through a prior-period adjustment.

Which of the following is not a source of a prior-period adjustment?

A) a mathematical mistake
B) the incorrect use of existing facts
C) misuse of a generally accepted accounting principle
D) a change from using one GAAP estimate to another GAAP estimate

Definitions

Learning Objectives

Learning Objectives

Related questions

Which of the following is not a source of a prior-period adjustment?A) a mathematical mistakeB) the incorrect use of existing factsC) misuse of a generally accepted accounting principleD) a change from using one GAAP estimate to another GAAP estimate

Definitions

Learning Objectives

Learning Objectives

Related questions

Which of the following is not a source of a prior-period adjustment?

A) a mathematical mistake
B) the incorrect use of existing facts
C) misuse of a generally accepted accounting principle
D) a change from using one GAAP estimate to another GAAP estimate