Match the item that best describes the presentation of the item on the financial statements with the situation. Numbers 1-4

1.Retroactive type accounting change

2.Handled prospectively.

3.Error correction, involving restatement.

4.None of the above

__At the end of 20x1, an audit revealed that the corporation's allowance for doubtful accounts was too large and should be reduced to 3%. When the audit was made in 20x0, the allowance seemed appropriate.

__In computing the depreciation in 20x1 for equipment, an error was made which overstated

__income in that year $95,000. The error was discovered in 20x4.

__In 20x1, the company incurred interest expense of $36,000 on a 20-year bond issue.

__In 20x1, the company changed its method of depreciating plant assets from the double-declining balance method to the straight-line method.

__Depreciation on a truck, acquired in 20x1, was understated because the service life had been overestimated. The under-statement had been made in order to show higher net income in 20x1, 20x2, and 20x3.

__In 20x1, the company discovered it was using an unaccepted accounting principle to account for certain items and adopts an accepted principle.

__A computer that was purchased in 20x1 was estimated to have a ten-year life. In 20x4 it is now considered to have a 2-year remaining life

__In 20x1, the company changed its method of recognizing income from the completed - contract method to percentage-of-completion method.

__After careful consideration, the % used in calculating estimated warranty costs is increased.

__During 20x1, a long-term bond with a book value of $4,500,000 was retired at a cost of $5,140,000.