Accounting Principles and Changes in Accounting

“Changes in Accounting Principles and Changes in Accounting Estimates” Please respond to the following:

  • From the e-Activity, discuss the accounting principles that the identified company changed, and explain the major reasons why the company changed accounting principles. Give your opinion on whether you believe the change in accounting principles was to benefit the corporation or investors and creditors. Provide a rationale for your response.
  • Imagine you are the senior accountant at your organization, and management is not sure of the difference between a change in accounting estimate and a change in accounting principle. Briefly discuss the difference between a change in accounting estimate and a change in accounting principle, and outline the impact the changes will have on the company’s financial statements. Give your opinion on why a company should avoid reporting changes in accounting principles and changes in accounting estimates. Provide a rationale for your response.

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