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:

Fishbone Diagram

A visual tool used for identifying and organizing the causes of a problem, typically resembling the shape of a fishbone.

Causes

The underlying factors or reasons for an event or situation, often analyzed in problem-solving and decision-making processes.

The Law of Unintended Consequences

The principle that actions, especially those taken on a large scale, can have unanticipated and often undesirable effects.

Uncertainty

The state of having limited knowledge, making it impossible to precisely predict the future or outcomes.