Homework Help is Here – Start Your Trial Now!
Business
Accounting
On January 1, 2025, Blossom Corporation changed to the percentage-of-completion method of income recognition. This change is justified by Blossom Corporation. On December 31, 2024, Blossom's Retained Earnings balance was $1620000. Blossom calculated that, if the percentage-of-completion method had been used, the accumulated impact on net income (before taking into consideration any income tax effects) would have been an additional $320000. If Blossom's income tax rate is 25%, one of the impacts of this accounting change would be O a decrease to the Retained Earnings balance on December 31, 2024, of $320000. O an increase to the Retained Earnings balance on December 31, 2024, of $320000. O an increase to Construction in Progress of $320000 on December 31, 2024. O an increase to Construction in Progress of $1620000 on December 31, 2024.

On January 1, 2025, Blossom Corporation changed to the percentage-of-completion method of income recognition. This change is justified by Blossom Corporation. On December 31, 2024, Blossom's Retained Earnings balance was $1620000. Blossom calculated that, if the percentage-of-completion method had been used, the accumulated impact on net income (before taking into consideration any income tax effects) would have been an additional $320000. If Blossom's income tax rate is 25%, one of the impacts of this accounting change would be O a decrease to the Retained Earnings balance on December 31, 2024, of $320000. O an increase to the Retained Earnings balance on December 31, 2024, of $320000. O an increase to Construction in Progress of $320000 on December 31, 2024. O an increase to Construction in Progress of $1620000 on December 31, 2024.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
See similar textbooks
icon
Related questions
Question

A1

On January 1, 2025, Blossom Corporation changed to the percentage-of-completion method of income recognition. This change is justified by Blossom Corporation. On December 31, 2024, Blossom's Retained Earnings balance was $1620000. Blossom calculated that, if the percentage-of-completion method had been used, the accumulated impact on net income (before taking into consideration any income tax effects) would have been an additional $320000. If Blossom's income tax rate is 25%, one of the impacts of this accounting change would be O a decrease to the Retained Earnings balance on December 31, 2024, of $320000. O an increase to the Retained Earnings balance on December 31, 2024, of $320000. O an increase to Construction in Progress of $320000 on December 31, 2024. O an increase to Construction in Progress of $1620000 on December 31, 2024.
Transcribed Image Text:On January 1, 2025, Blossom Corporation changed to the percentage-of-completion method of income recognition. This change is justified by Blossom Corporation. On December 31, 2024, Blossom's Retained Earnings balance was $1620000. Blossom calculated that, if the percentage-of-completion method had been used, the accumulated impact on net income (before taking into consideration any income tax effects) would have been an additional $320000. If Blossom's income tax rate is 25%, one of the impacts of this accounting change would be O a decrease to the Retained Earnings balance on December 31, 2024, of $320000. O an increase to the Retained Earnings balance on December 31, 2024, of $320000. O an increase to Construction in Progress of $320000 on December 31, 2024. O an increase to Construction in Progress of $1620000 on December 31, 2024.
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 3 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Accounting for Income Taxes
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education
SEE MORE TEXTBOOKS