Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term.
-Prior period adjustment
A)Allocation of cost for plant and equipment.
B)Is a change in accounting estimate.
C)Results from subsequent year correction of a material error.
D)Expenditures made to maintain a given level of benefits from an asset.
E)Generate declining amounts of depreciation over time.

Question

Quizplus · Accepted Answer

Prior period adjustments are corrections of material errors in the financial statements of prior periods. They are not regular occurrences like depreciation (which can generate declining amounts of depreciation over time) or routine maintenance expenditures. They are distinct from changes in accounting estimates, which do not correct past errors but rather adjust estimates for the future.

Listed Below Are Five Terms Followed by a List of Phrases