At the beginning of 2024 , a construction company that began operations in...
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Accounting
At the beginning of 2024 , a construction company that began operations in 2022 changed from the completed-contract method to the percentage-of-completion method for accounting purposes but not for tax purposes. Gross profit figures under both methods for the past three years appear below: The company reports two years of comparative statements. Assuming an income tax rate of 20% for all years, the effect of this accounting change on prior periods after taxes should be reported by a credit of $616000 on the 2024 income statement. $356000 on the 2023 retained earnings statement. $896000 on the 2023 income statement. $896000 on the 2024 retained earnings statement
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