In year 2, Rogers Corp. changes its inventory method from FIFO to the weighted-average method. Under the weighted-average method, the year 2 beginning inventory is $5,000 lower than under the FIFO method. The financial statements are revised using the retrospective approach. What are the financial statement effects of the change in accounting principle?

Question

Jovanni Barker

Business

12 April, 20:17

In year 2, Rogers Corp. changes its inventory method from FIFO to the weighted-average method. Under the weighted-average method, the year 2 beginning inventory is $5,000 lower than under the FIFO method. The financial statements are revised using the retrospective approach. What are the financial statement effects of the change in accounting principle?

+2

Answers (1)

Know the Answer?

Izabelle Perkins · Answer 1

Under the weighted-average method, the year 2 beginning inventory is $5,000 lower than under the FIFO method.

Year 1 net income will decrease and Year 1 ending inventory will decrease