Accounting treatment for changes in accounting principle are best described as:
Multiple Choice
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Changes in accounting principle that are only permitted when FASB issues a standard that revises GAAP.
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Tax effects are ignored when reporting changes in accounting principles.
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Changes in accounting principle that may require both a restatement of prior years’ financial information and the recording of a cumulative adjustment to retained earnings.
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Changes in accounting principle that are always accounted for using the retrospective approach which requires only a restatement of prior years’ presented financial information.
The Shill Company uses the dollar-value LIFO method for valuing inventory. The following inventory information is available at the end of the year:
| Year | Year-End Price | Price Index | ||||
| 1 | $ | 200,000 | 100 | |||
| 2 | 250,000 | 105 | ||||
| 3 | 296,000 | 108 | ||||
| 4 | 286,000 | 110 | ||||
The inventory under dollar-value LIFO at the end of Year 3 is:
Multiple Choice
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$278,857.
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$274,074.
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$300,000.
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$276,800.
