Question 8 (2 points) You are working as the controller of a company and the CEO comes to you and says "Bad news! The plant manager just told me we are going to have to restate prior year financial statements because we've overstated depreciation. Originally, we estimated the equipment to last 5 years and to have a residual value of $50,000. Now he tells me it will last 8 years and will have a residual value of $30,000. I guess we'll have to go back and recalculate the depreciation for the previous 3 years." Required: Respond to the CEO and explain how a change in estimate such as this should be recorded. (2 marks - 5 minutes) v Paragraph Page 8 of 18 Next Page W