Question

Which one of the follwing statements regarding revision of depreciation rates is incorrect?

A. no entry is made at the time a revision of depreciation rates occurs.
B. opening balances are not adjusted when a change in estmate occurs.
C. Changes in estimate should be handled in the current period only
D. depreciation is computing by dividing the remaining book value less any salvage value by the remaining estimated life

Answer 1

The incorrect statement regarding revision of depreciation rates is that opening balances are not adjusted when a change in estimate occurs.

Step-by-step explanation:

The correct statement regarding revision of depreciation rates in accounting is B. Opening balances are not adjusted when a change in estimate occurs.

When a revision in depreciation rates occurs due to a change in estimate, no entry is made at the time of the revision (Option A). Opening balances are not adjusted when a change in estimate occurs (Option B). Changes in estimate should be handled in the current period only (Option C). Depreciation is computed by dividing the remaining book value less any salvage value by the remaining estimated life (Option D).

In summary, the incorrect statement regarding revision of depreciation rates is that opening balances are not adjusted when a change in estimate occurs.