During 2021, Tricky Company decided to change from FIFO method of inventory valuation to the weighted average method. Inventory balances under each method were as follows: Weighted Average 1,540,000 1,660,000 FIFO 1,420,000 1,580,000 January 1 December 31 Income tax rate is 35%. In its 2021 statement of retained earnings, what amount should Tricky report as the effect of this accounting change?
During 2021, Tricky Company decided to change from FIFO method of inventory valuation to the weighted average method. Inventory balances under each method were as follows: Weighted Average 1,540,000 1,660,000 FIFO 1,420,000 1,580,000 January 1 December 31 Income tax rate is 35%. In its 2021 statement of retained earnings, what amount should Tricky report as the effect of this accounting change?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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In its 2021 statement of
report as the effect of this accounting change?
Transcribed Image Text:During 2021, Tricky Company decided to change from FIFO method of inventory valuation to
the weighted average method. Inventory balances under each method were as follows:
Weighted Average
1,540,000
1,660,000
FIFO
January 1
December 31
1,420,000
1,580,000
Income tax rate is 35%.
In its 2021 statement of retained earnings, what amount should Tricky report as the effect of
this accounting change?
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