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?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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