A retrospectively applied change in accounting policy relating to fixed assets where a company changes from the straight-line amortization method to the double-declining balance method would result in a decrease to opening retained earnings.

Question

Quizplus · Accepted Answer

A change in accounting policy applied retrospectively would adjust the carrying amounts of assets and liabilities as if the new policy had always been applied, but it does not directly affect opening retained earnings unless there is a correction of an error.

A Retrospectively Applied Change in Accounting Policy Relating to Fixed