Washburn Co. spent $10 million to purchase a new patented technology, debiting an intangible asset and crediting cash. Washburn uses SYD depreciation on its depreciable assets and plans to amortize the intangible asset on a straight-line basis.
A)Washburn is not required to make any accounting adjustments.
B)Washburn is required to adjust a change in accounting estimate prospectively.
C)Washburn has made a change in accounting principle, requiring retrospective adjustment.
D)Washburn needs to correct an accounting error.

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The Answer of Washburn Co. spent $10 million to purchase a new patented technology, debiting an intangible asset and crediting cash. Washburn uses SYD depreciation on its depreciable assets and plans to amortize the intangible asset on a straight-line basis.
A)Washburn is not required to make any accounting adjustments.
B)Washburn is required to adjust a change in accounting estimate prospectively.
C)Washburn has made a change in accounting principle, requiring retrospective adjustment.
D)Washburn needs to correct an accounting error.