A.An accounting change from one generally accepted accounting principle to another generally accepted accounting principle.B.An accounting change involving a change in the reportingentity, which is a special type of change in accounting principles.C.An accounting change involving a correction of an error inprinciple, which is accounted for as a correction of an error.D.An accounting change involving a change in an accounting estimate.E.An accounting change involving both a change in accounting principle and a change in accounting estimate. Although the effect of the change in each may be inseparable and the accounting for such a change is the same as that for a change in estimateonly, an accounting principle is involved.F.An error correction not involving an accounting principle.G.Not an accounting change but rather a change in classification.

RequirementIdentify the type of change described in each itemabove, and state whether any modification is required in theauditor's report as it relates to consistency. Organize your answer sheet as shown. Forexample, a change from the LIFO method of inventory pricing to the FIFO method of inventory pricing would appear as shown. LOADING...(Clickthe icon to view theexample.) LOADING...(Clickthe icon to view the types ofchanges.)

		Should Auditor's
Item No.	Type of Change	Report Be Modified?
1.
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3.
4.

5.
6.
7.
8.

Choose from any drop-down list and then click Check Answer.

This is the information you need to answer the question.

1.	Correction of a mathematical error in inventory pricing made in a prior period.
2.	A change from deferring and amortizing preproduction costs to recording such costs as an expense when incurred because future benefits of the costs have become doubtful. The new accounting method was adopted in recognition of the change in estimated future benefits.
3.	A change from thecompleted-contract method to thepercentage-of-completion method of accounting forlong-term construction contracts.
4.	A change in the estimated useful life of previously recorded fixed assets based on newly acquired information.
5.	A change to including the employer share of Social Security(FICA) taxes as"retirement benefits" on the income statement from including it with"other taxes."
6.	A change from prime costing to full absorption costing for inventory valuation.
7.	A change from presentation of statements of individual companies to presentation of consolidated statements.
8.	A change from the FIFO method of inventory pricing to the LIFO method of inventory pricing.

These are the type of changes to choose from

This is what you choose from to answer the type of changes

A. An accounting change from one generally accepted accounting principle to another generally accepted accounting principle. B. An accounting change involving a change in the reportingentity, which is a special type of change in accounting principles. C. An accounting change involving a correction of an error inprinciple, which is accounted for as a correction of an error. D. An accounting change involving a change in an accounting estimate. E. An accounting change involving both a change in accounting principle and a change in accounting estimate. Although the effect of the change in each may be inseparable and the accounting for such a change is the same as that for a change in estimateonly, an accounting principle is involved. F. An error correction not involving an accounting principle. G.

Not an accounting change but rather a change in classification.