When a change in accounting principle occurs, the balance of the related asset or liability account is recalculated
A)at the end of the current period
B)when the decision is made to change
C)at the beginning of the current period only
D)at the beginning of the first period affected and reported in the financial statements

Question

Quizplus · Accepted Answer

When a change in accounting principle occurs, the balance of the related asset or liability account is recalculated at the beginning of the first period affected and reported in the financial statements. This is known as a retrospective application of the new accounting principle. The financial statements must show the impact of the accounting change on prior periods presented.

When a Change in Accounting Principle Occurs, the Balance of the Related