Question: Scroll down to complete all parts of this task. Indicate the proper accounting treatment for each of the individual situations described below. From the option
Scroll down to complete all parts of this task.
Indicate the proper accounting treatment for each of the individual situations described below. From the option list in column B, select the type of accounting change. From the option list in column C, select the appropriate method of accounting.
| A | B | C | |
|---|---|---|---|
| 1 | Situation | Type of Change | Method of Accounting |
| 2 | Dawg Corp. changed its inventory valuation method from FIFO to LIFO to more fairly reflect the cost flow of goods. | ||
| 3 | Duck Company changed from the income tax basis of accounting to the full accrual basis of accounting, as required by its bank in order to obtain financing. | ||
| 4 | Gosling, LLC was acquired by Goose International. Goose presents consolidated financial statements. | ||
| 5 | Kitty Corp. decided to improve shareholder return and stimulate the company's stock price by changing its inventory valuation method from LIFO to FIFO. | ||
| 6 | The final judgment on a lawsuit is decided in the current year against Big Trouble, Inc. The amount is significantly greater than previously thought. The company properly accrued $1 million as a liability on their previous financial statement. The final judgment is for $15 million. |
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