Goosen Company bought a copyright for $90,000 on January 1, 2010, at which time the copyright had an estimated useful life of 15 years. On January 5, 2013, the company determined that the copyright would expire at the end of 2018. How much should Goosen record retrospectively as the effect of change?
A)$0.
B)$12,000.
C)$8,000.
D)$14,400.

Question

Quizplus · Accepted Answer

The change in the useful life of the copyright is a change in estimate, not a change in accounting principle. Therefore, no retrospective adjustment is needed, and the effect is accounted for in the current and future periods.

Goosen Company Bought a Copyright for $90,000 on January 1