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In this video tutorial, the presenter explains how to account for changes in accounting estimates, which are crucial in various areas such as bad debt, useful life, and warranty liabilities. Since estimates can be inaccurate, adjustments and revisions are necessary as new information becomes available. The method used for these changes is called prospective application, where errors are corrected moving forward without restating prior financial statements. For instance, if the useful life of property, plant, and equipment is adjusted from 16 years to 20 years, the new depreciation amount is calculated and applied going forward.