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In this tutorial, the speaker explains how to account for changes in accounting estimates, which are essential in financial management. Managers routinely estimate factors such as bad debt, useful life, salvage value of property, plant, and equipment, and warranty liabilities. Errors in these estimates are common, necessitating adjustments and revisions. The process used for these corrections is known as prospective application, where mistakes are fixed moving forward without restating prior financial statements. For example, if it is determined that the useful life of an asset is 20 years instead of 16, the depreciation amount is recalculated based on the new estimate, and this revised amount is used for future accounting periods.