Prior years income statements are not restated for
A) changes in accounting principle.
B) changes in estimates.
C) corrections of errors.
D) All of these answer choices are correct.

Question

Quizplus · Accepted Answer

Changes in estimates are not restated in prior years' income statements. Instead, the effects of changes in estimates are accounted for prospectively, in the period of change and future periods if the change affects both. Changes in accounting principles and corrections of errors, however, typically require restatement of prior periods to reflect the retrospective application of the new accounting principle or to correct the errors.

Prior Years Income Statements Are Not Restated for