A Change in the Estimated Useful Life and Residual Value

Multiple Choice

A change in the estimated useful life and residual value of machinery in the current year is handled as:

A) A retrospective change back to the date of acquisition as though the current estimated life and residual value had been used all along.
B) A prospective change from the current year through the remainder of its useful life, using the new estimates.
C) A cumulative adjustment to income in the current year for the difference in depreciation under the new versus old estimates.
D) None of the above is correct.