Reference no: EM132677605

Problem 1: Which method is required for reporting a change in accounting policy?

a. Averaging approach

b. Cumulative effect approach

c. Retrospective approach

d. Prospective approach

Problem 2: A change in accounting policy requires that the cumulative effect of the change for prior periods be shown as an adjustment to

a. Comprehensive income for the earliest period presented.

b. Net income for the period in which the change occurred.

c. Shareholder's equity for the period in which the change occurred.

d. Beginning retained earnings for the earliest period presented.

Problem 3: Which of the following is not treated as a change in accounting policy?

a. A change to a new IFRS requirement.

b. A change from direct write-off method of recognizing bad debt expense to allowance method.

c. A change from FIFO inventory valuation to average cost.

d. A change from cost model to fair model in measuring investment property.