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Sample Disclosure – Change In Accounting Estimate On Depreciation Charges (19 February 2009)

Posted by learnaccounting on February 19, 2009

If you need sample disclosure on change of accounting estimates please refer to:Change Of Accounting Estimates

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2 Responses to “Sample Disclosure – Change In Accounting Estimate On Depreciation Charges (19 February 2009)”

  1. Chris said

    Facts from case study in my class: Company XYZ historically depreciates all assets using DDB. New machine is purchased and depreciated using SL. Is disclosure to show effect on current earnings? Under DDB, expense would have been $120,000. With SL, expense was $57,000. Do we disclose that an additional $63,000 would hvae been expensed if DDB were used?

    thanks.

    • learnaccounting said

      Change in depreciation method is now treated as a change in accounting estimate. You need to disclose the effect of the change in the current period and also for future periods.

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