Which of the Following Would Not Be Accounted for Using

question 14

Multiple Choice

Which of the following would not be accounted for using the prospective approach?

• A) A change to LIFO from FIFO for inventory costing.
• B) A change in price indexes used under the LIFO method of inventory costing.
• C) A change in estimate.
• D) A change from the cash basis to accrual accounting.

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Definitions:

Stock Market

A collection of markets where stocks (pieces of ownership in businesses) are bought, sold, and issued.

Risk Premium

A risk premium is the extra return above the risk-free rate that investors require as compensation for the risk of holding a risky asset.

Future Payments

Payments that are scheduled to be made at a later date or period.

Interest Rate

The fee a lender imposes on a borrower for access to assets, denoted as a proportion of the principal sum.