How is a change in an estimate of the salvage value and/ or useful life of...
How is a change in an estimate of the salvage value and/ or useful life of an asset recorded?
Homework Answers
Solution:
As per fundamental of accounting, change in estimate is not considered as change in accounting principals, therefore retrospective effect is not considered for change in estimates instead same is applied prospectively.
Therefore change in estimate of salvage value and/or useful life of an asset recorded as revised depreciation is calculated for remaining useful life and charged accordingly.
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