Accounting Changes – The various types of accounting changes may significantly affect the presentation of a company’s financial statements, and also affect the trends shown in its comparative financial statements and historical summaries.
Required
1. Explain a change in accounting principle and how a company reports it in the period of the change.
2. Explain a change in accounting estimate and how a company reports it in the period of the change.
3. Explain a change in reporting entity and how a company reports it. Give an appropriate example of a change in reporting entity.
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