When accounting for long-lived assets, companies may make modifications in the procedures related to specific assets.Companies may change depreciation methods or may change an estimate of the service life of the assets.
Required:
Describe how these two types of accounting changes are to be handled.

Changes in asset service life are considered to be a change in estimate.This change is handled prospectively by allocating the undepreciated cost of the asset at the beginning of the year of the change over the new remaining service life of the asset.A change in depreciation method for a currently owned asset is a change in accounting estimate effected by a change in accounting principle.The impact of the change is handled prospectively.The undepreciated cost (considering residual value)of the asset at the beginning of the year of the change in method is allocated over the remaining useful life of the asset.