a$.$

A furniture maker decreases bad debts expense from$3\%$ to$2\%$ of credit sales.

b$.$

A manufacturer determines that credit losses are becoming material due to deteriorating economic conditions. As a$$ result, it decides to set up an allowance for doubtful accounts at$5\%$ of amounts over $90$ days.

c$.$

A parking service estimates bad debts to be$10\%$ of the value of parking violations issued. In the current$$ year, it changes to estimating the allowance for bad debts to be equal to$20\%$ of accounts $30$ to $90$ days and$50\%$ of accounts over $90$ days.

Required

Evaluate each of the independent situations to determine the type of accounting change$($correction of$$ error, change in accounting$$ policy, or change in$$ estimate$)$ and the appropriate accounting treatment$($retrospective or$$ prospective$).($Refer to each situation by letter$$ reference.$)$