When an accounting change is reported under the retrospective approach, prior years' financial statements are: Select one: a. Left unchanged. b. Revised to reflect the use of the new principle. c. Reported as previously prepared. d. Adjusted using prior period adjustment procedures.

Question

Gerardo

Business

30 July, 06:37

When an accounting change is reported under the retrospective approach, prior years' financial statements are: Select one: a. Left unchanged. b. Revised to reflect the use of the new principle. c. Reported as previously prepared. d. Adjusted using prior period adjustment procedures.

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Answers (1)

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Syllable · Answer 1

b. Revised to reflect the use of the new principle.

Explanation:

As most of the changes in the account principles need to be disclosed that justifies the changes in the first set of the financial statements. That the change is made and all changes using this retrospective approach needs a prior adjustment and all chances are accounted retrospectively. Thus is revised to make use of the new principle.