AICPA Exam CPA-Financial Topic 2 Question 41 Discussion

Choice 'b' is correct. No - Yes

Change in estimated lives of depreciable assets is a 'change in estimate.' They affect only current and future periods (not 'prior periods,' not retained earnings).

Change from unaccepted principle to accepted principle is an example of an error of a prior period that should be reported as a 'prior period adjustment.'