Question 5 0.5 pts It has been revealed that the depreciation rate applied for machinery by Mansfield limited is the one recommended by the taxation authority and it does not reflect the way the machinery is used in the business. Hence, the accountants recommended that the depreciation rate should be changed. The correct accounting treatment for this event is to: treat it as a change in an accounting estimate and adjust prospectively, disclose the change in the notes to the financial statements. treat it as a change in an accounting estimate and adjust retrospectively. treat it as an error and adjust retrospectively. Question 6 0.5 pts An item of financial information is material if: it is more than 5% of total assets when aggregated excluding the item would make the financial statement not comparable with the financial statements of other entities or previous periods' financial statements of the same entity it is significant it can influence the economic decisions made by the users of financial statements Previous Next 0.5 pts The majority of a company's workforce contracted COVID-19 soon after the financial statements for the financial year ended 30 June 2x21 were prepared but before they were authorised for issue. This caused severe disruptions to the continuity of company operations and the company faces severe financial hardship. The financial statements for the year ended 30 June 2X21 were expected to be finalised by 4 August 2X21. What is the appropriate accounting treatment regarding this event according to IAS/AASB 110 Events after the Reporting Period: It is a non-adjusting event and therefore, disclose as a note to the financial statements. It is an adjusting event and therefore, the financial statements should be adjusted. the event has occurred after the end of the reporting period and therefore, do nothing. Possible answer it is an adjusting event, therefore, disclose as a note to the financial statements