Classifying accounting changes Indicate with the appropriate letter the nature of each situation described below:
Type of Change
PR
 Change in principle reported retrospectively
PP
 Change in principle reported prospectively
E
 Change in estimate
EP
 Change in estimate resulting from a change in principle
R
 Change in reporting entity
N
 Not an accounting change
. 1. Change from declining balance depreciation to straight-line.
. 2. Change in the estimated useful life of office equipment.
. 3. Technological advance that renders worthless a patent with an unamortized cost of $45,000.
. 4. Change from determining lower of cost or market for the inventories by the individual item approach to the aggregate approach.
. 5. Change from LIFO inventory costing to the weighted-average inventory costing.
. 6. Settling a lawsuit for less than the amount accrued previously as a loss contingency.
. 7. Including in the consolidated financial statements a subsidiary acquired several years earlier that was appropriately not included in previous years.
. 8. Change by a retail store from reporting bad debt expense on a pay-as-you-go basis to the allowance method.
. 9. A shift of certain manufacturing overhead costs to inventory that previously were expensed as incurred to more accurately measure cost of goods sold. (Either method is generally acceptable.)
. 10. Pension plan assets for a defined benefit pension plan achieving a rate of return in excess of the amount anticipated.