1. In 20X8, Jane Co. changed from FIFO to LIFO method of accounting for inventory. Because of the length of time Jane has been in business, the cumulative effect of the change is not practicable to determine. Under ASC 250, it is acceptable for Jane Co. to report this change in which of the following ways?

Change in estimate on a prospective basis.

Prior period adjustment with separate disclosure.

Earliest prospective application to the extent it is practicable.

a. I or II only

b. III only

c. II only

d. I, II, or III

2. Which of the following statements is correct as it relates to changes in accounting estimates?

a.Most changes in accounting estimates are accounted for retrospectively.

b.It is easier to differentiate between a change in accounting estimate and a change in accounting principle than it is to differentiate between a change in accounting estimate and a correction of an error.

c.Whenever it is impossible to determine whether a change in accounting estimate or a change in accounting principle has occurred, the change should be considered a change in estimate.

d.Whenever it is impossible to determine whether a change in an estimate or a change in accounting principle occurred, the change should be considered a change in principle.

3.Conn Corp. owns an office building and normally charges tenants $30 per square foot per year for office space. Because the occupancy rate is low, Conn agreed to lease 10,000 square feet to Hanson Co. at $12 per square foot for the first year of a three-year operating lease. Rent for remaining years will be at the $30 rate. Hanson moved into the building on January 1, 20X2, and paid the first year's rent in advance. What amount of rental revenue should Conn report from Hanson in its income statement for the year ended September 30, 20X2?

a.$240,000

b.$90,000

c.$120,000

d.$180,000