A subsequent event for an entity with a December 31, 2018, year-end would not include:
A) A change in the estimated useful lives of equipment in January 2019.
B) An issuance of bonds in January 2019.
C) An acquisition of another company in January 2019.
D) A major uncertainty at December 31, resolved in January 2019.

Question

Quizplus · Accepted Answer

Subsequent events are significant events that occur between the balance sheet date and the date when the financial statements are issued. A change in the estimated useful lives of equipment in January 2019 would be considered an accounting estimate change rather than a subsequent event, as it relates to the entity's judgments and assumptions about future periods rather than a specific event or transaction occurring after the balance sheet date.

A Subsequent Event for an Entity with a December 31