A Change from Moving Weighted Average to FIFO Reporting Is

question 27

Multiple Choice

A change from moving weighted average to FIFO reporting is:

• A) A change in accounting principle and is allowed if it improves the usefulness of information in the financial statements.
• B) Allowed if it improves the usefulness of information in the financial statements.
• C) Not allowed once an inventory costing method has been chosen.
• D) A change in accounting principle and is not allowed even if it improves the usefulness of information in the financial statements.
• E) A change that results in a discontinued operation.

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Definitions:

Marketability

The ability of a product or service to be sold or marketed effectively to consumers.

Convertible Debt

A type of financing option that allows the holder to convert the outstanding debt into equity, typically shares of the issuing company, under specified conditions.

Venture Capitalist

A professional investor who provides capital to companies exhibiting high growth potential in exchange for equity or an ownership stake.

Equity

The value of an ownership interest in property, including shareholders' equity in a company, which represents the residual value to shareholders after debts and liabilities have been settled.