Delta CoBegan Operations on January 1,2012 Required:
A

question 37

Essay

Delta Co.began operations on January 1,2012.During 2012 and 2013,the company used the weighted-average method for its inventory costing.In 2014,the company changed its method of inventory costing to FIFO so that its financial statements would be more comparable to those of other firms in its industry.If the FIFO method had been used,Delta's cost of goods sold would have been $45,000 less in 2012 and $35,000 less in 2013.Delta's income statements,as originally presented,appear below.Delta's tax rate is 30%.
$\begin{array}{lrrr} & \mathbf{2 0 1 2} & \mathbf{2 0 1 3} &{\mathbf{2 0 1 4}} \\\text { Sales } & \$ 1,000,000 & \$ 1,100,000 & \$ 1,210,000 \\\text { Cost of goods sold } & 645,000 & 695,000 & 726,000 \\\text { Gross profit } & 355,000 & 405,000 & 484,000 \\\text { Selling, general and administrative expenses } & 250,000 & 255,000 & 265,000 \\\text { Depreciation expense } & 55,000 & 55,000 & 55,000\\\text { Income before tax } & 50,000 & 95,000 & 164,000 \\\text { Income tax expense } & \underline{15,000} & \underline{28,500} & \underline{49,200} \\\text { Net income } & \underline{\underline{\$ 35,000}} & \underline{\underline{\$ 66,500}} & \underline{\underline{\$ 114,800}}\end{array}$
Required:
a.Assume that for comparison purposes Delta presents 2012 and 2013 income statements in its 2014 annual report.Revise Delta's 2012 and 2013 income statements to appear as they should in the 2014 annual report.
b.Prepare the journal entry required in 2014 to record Delta's change in accounting principle.

Understand the controversies and purposes surrounding the development and revision of the DSM.

Differentiate between ego-syntonic and ego-dystonic disorders and their implications for self-perception and treatment seeking.

Recognize specific personality disorders and their defining features.

Understand the links between personality disorders and other factors such as genetic, economic status, and behavioral attributes.

---

Definitions:

Devalued

Devalued is a term used to describe a reduction in the value of a currency with respect to other currencies, often through government policy.

Exports

Goods or services produced in one country and sold to buyers in another country.

Imports

Imports refer to the goods and services that are brought into a country from abroad for sale.

Balance Of Trade Surplus

Occurs when a country's exports exceed its imports during a given time period, indicating a positive balance of trade.