Depreciation method error overstates expense, correction boosts profit Steps:

• Depreciation recorded using reducing balance method: $20,000 × 30$6,000
• Correct straight-line depreciation: $20,000 / 5 years =$4,000
• Excess expense recorded: $6,000 -$4,000 = $2,000
• Correction reduces depreciation expense by $2,000, increasing profit by$2,000

Why A is correct:

• Error correction adjusts expense to correct amount, increasing profit by excess recorded per IAS 8 accounting policy error rules.

Why the others are wrong:

• B: Opposite effect; correction reduces expense, raising profit.
• C: Matches recorded expense but ignores net adjustment to correct method.
• D: Matches recorded expense but misapplies as profit increase without netting difference.

Final answer: A