The various types of accounting changes may significantly affect the presentation of a companys financial statements, and also affect the trends shown in its comparative financial statements and historical summaries Required 1 Explain a change in accounting principle and how a company reports it in...

1 A change in accounting principle results from adoption of a generally accepted accounting principle different from the one used previously for repor ...

The various types of accounting changes may significantly affect the presentation of a companys financial statements, and

Question:

The various types of accounting changes may significantly affect the presentation of a company’s and also affect the trends shown in its comparative and historical summaries.
Required
1. Explain a change in accounting principle and how a company reports it in the period of the change.
2. Explain a change in accounting estimate and how a company reports it in the period of the change.
3. Explain a change in reporting entity and how a company reports it. Give an appropriate example of a change in reporting entity.

Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial...