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A company discovers an error in their prior year's financial statements. This error led to an understatement of net income. How is this correction treated?
A company discovers an error in their prior year's financial statements. This error led to an understatement of net income. How is this correction treated?
A As an adjustment to current period retained earnings
B Reported in the current year's income statement as an unusual item
C As a prior period adjustment, directly adjusting the beginning retained earnings balance.
D As a change in accounting estimate affecting future periods
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