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Certain non current asset with a carrying value of $112,000,at the beginning of the year,were being depreciated at 15% on the reducing balance basis.Because of the changed economic environment the directors consider that the straight line method would more appropriate. The remaining useful economic life is estimated to be four years, with nil residual values.Sir ,is this a change of accounting policy or a change in estimates and why??
The policy is to “depreciate assets over their estimated useful lives”
How we achieve that objective is left to individual entities so a switch from reducing balance to straight line is a change in estimate
OK?
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