Changes in depreciation methods are changes in accounting principles handled retrospectively.

Name: Changes in depreciation methods are changes in accounting principles handled retrospectively.
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Question

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Changes in accounting principles, such as changes in depreciation methods, are required to be handled retrospectively according to U.S. GAAP. This means that the cumulative effect of the change needs to be recognized in the financial statements for prior periods as an adjustment to beginning retained earnings.

Changes in Depreciation Methods Are Changes in Accounting Principles Handled