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in this video Iamp;#39;m gonna show you how to account for a change in accounting estimate so estimates are a big part of accounting managers have to estimate how much bad debt thereamp;#39;ll be what will be the useful life and salvage value of any property plant equipment what kind of warranty liabilities will the company have and so theyamp;#39;re going to make mistakes because the estimates are gonna be off and so weamp;#39;re gonna have to make adjustments and revisions from time to time when we learn that our estimate was not right and so what weamp;#39;re gonna do is weamp;#39;re gonna use something called prospective application which is basically we just fixed the mistake and we move forward okay so we donamp;#39;t go back and restate the prior periods financial statements if we just learned that oh okay the useful life of this property plant equipment is going to be 20 years instead of 16 years we make the change we figure out what the new depreciation is gonna be and