ASSESSMENT CASE PAPER ANALYSIS / TUTORIALOUTLET DOT COM ASSESSMENT CASE PAPER ANALYSIS / TUTORIALOUTLET DO | Page 19

prospective application.
D. Hutton needs to correct an accounting error.
15. Hepburn Company bought a copyright for $90,000 on January 1,
2012, at which
time the copyright had an estimated useful life of 15 years. On
January 5, 2015, the
company determined that the copyright would expire at the end of
2018. How much
should Hepburn record as amortization expense for this copyright for
2015?
A. $14,400.
B. $7,200.
C. $18,000.
D. $12,000.
16. Cooper Inc. took physical inventory at the end of 2015. Purchases
that were
acquired FOB destination were in transit, so they were not included in
the physical
count.
A. Cooper needs to correct an accounting error.
B. Cooper has made a change in accounting principle, requiring
retrospective
adjustment.
C. Cooper is required to adjust a change in accounting estimate
prospectively.
D. Cooper is not required to make any accounting adjustments.
17. Heuer Company's prepaid insurance was $8,000 at December 31,
2015, and
$10,000 at December 31, 2016. Heuer reported insurance expense of
$15,000 on the
2016 income statement. What amount would be reported in the
statement of cash flows
as insurance paid using the direct method?
A. $13,000.
B. $17,000.
C. $15,000.
D. $23,000. 5 18. Which of the following circumstances creates a