Identification of Accounting Changes and Errors Indicate whether the following items are a (a) change in accounting principle, (b) change in accounting estimate, (c) change in reporting entity, or (d) correction of an error. 1. The salvage value of a building being depreciated over 30 years is adjusted from $15,000 to $5,000 due to the unexpected deterioration of the building. 2. A company discovered that depreciation expense was overstated by $50,000 in the prior year's financial statements due to incorrect asset valuation amounts entered into the fixed asset depreciation software. 3. A company changes its depreciation method from the straight-line method to the double-declining balance method for the long-term asset category of equipment