11) Which of the following requires an adjustment to the opening balance of retained earnings in the earliest period of the comparative financial statements presented? A. A change in the estimated useful life of machinery B. A change in the expected residual value of a property C. A change from straight line to declining balance depreciation D. A change from First-in, First-out (FIFO) to weighted average inventory cost flow assumption 12) which of the following serves as the justification for the recognition of expired cost? A. Cause and effect association C. Immediate recognition of an expense B. Systematic and rational allocation D. Minimization of income tax liability 13) Each of the following errors will overstate net income of current year, except A. Equipment purchased in a prior year was expensed C. Accrued wages were not recorded at current year-end B. Current year end ending inventory was overstated D. PPE purchased in the current year was expensed 14) In double-entry bookkeeping system which of the following may be used as basis for recognizing income and expenses? Cash basis Modified cash basis Accrual basis A. YES YES YES B. NO YES NO C. YES NO NO D. NO NO YES