Generally accepted accounting principles should be applied consistently from period to period. However, changes within a company,

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Generally accepted accounting principles should be applied consistently from period to period. However, changes within a company, as well as changes in the external economic environment, may force a company to change an accounting method. The specific reporting requirements when a company changes from one generally accepted inventory method to another depend on the methods involved.


Required:

Explain the accounting treatment for a change in inventory method

(a) Not involving LIFO,

(b) From the LIFO method, and

(c) To the LIFO method.

Explain the logic underlying those treatments. Also, describe how disclosure requirements are designed to address the departure from consistency and comparability of changes in accounting principle.


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Related Book For  book-img-for-question

Intermediate Accounting

ISBN: 978-1260481952

10th edition

Authors: J. David Spiceland, James Sepe, Mark Nelson, Wayne Thomas

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