Washburn Co

Multiple Choice

Washburn Co. spent $10 million to purchase a new patented technology, debiting an intangible asset and crediting cash. Washburn uses SYD depreciation on its depreciable assets and plans to amortize the intangible asset on a straight-line basis.

A) Washburn is not required to make any accounting adjustments.
B) Washburn is required to adjust a change in accounting estimate prospectively.
C) Washburn has made a change in accounting principle, requiring retrospective adjustment.
D) Washburn needs to correct an accounting error.