List of Classification options:

Type of Accounting Treatments:

On January 2, Quo, Inc, hired Reed to be its controller. During the year, Reed, working closely with Quo's presid and outside accountants, made changes in accounting policies, corrected several errors dating from previous years, and instituted new accounting policies Quo's current-year financial statements will be presented in comparative form with its prior-year financial statements Select from the option lists provided the most appropriate classification and accounting treatment for each transaction. Each choice may be used once, more than once, or not at all Transaction Classification Accounting treatment 1. At the end of the year, Quo determined that the allowance for uncollectible accounts should be 4% of the accounts receivable balance. The allowance in the previous year was 3.6% 2. Quo determined that manufacturing equipment previously depreciated under an accelerated method should be depreciated under the straight line method 3. Quo presented consolidated statements for the first time 4. Quo properly changed from LIFO to FIFO to account for its work-in-process inventory 5. Quo properly changed from weighted-average cost to the specific identification method to account for its finished goods inventory O Change in accounting principle O Change in accounting estimate O Change in reporting entity O Correction of an error in previously presented financial statements O A change in estimate inseparable from a change in principle O Neither an accounting change nor an accounting error O Retrospective application O Prospective approach