If a change in an accounting estimate affects current net income by an amount equal to or greater than 1% of net income, the change should be handled retroactively.

Name: If a change in an accounting estimate affects current net income by an amount equal to or greater than 1% of net income, the change should be handled retroactively.
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Question

Quizplus · Accepted Answer

Changes in accounting estimates are accounted for prospectively, not retroactively, and affect the period of change and future periods if the change affects both.

If a Change in an Accounting Estimate Affects Current Net