Which of the Following Changes in Accounting Principle Does Not

question 17

Multiple Choice

Which of the following changes in accounting principle does not require the retrospective approach?

• A) Change from the percentage-of-completion to the completed-contract method
• B) Change of inventory method from LIFO to FIFO
• C) Change of inventory method from FIFO to LIFO
• D) All of these require retroactive adjustment.

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Definitions:

Preferred Shareholders

Investors who own preferred shares in a company, giving them priority over common shareholders in the distribution of dividends and assets.

Vote

The act of making a choice in an election or decision-making process.

Financing Corporation

A company that provides money to individuals or businesses for the purpose of investment or purchase, expecting repayment usually with interest.

Advantages and Disadvantages

This term refers to the positive and negative aspects of a specific situation, decision, or strategy.