The Cecil-Booker Vending Company changed its method of valuing inventory from the average cost method...
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The CecilBooker Vending Company changed its method of valuing inventory from the average cost method to the FIFO cost method at the beginning of At December inventories were $average cost basis and were $ a year earlier. CecilBookers accountants determined that the inventories would have totaled $ at December and $ at December if determined on a FIFO basis. A tax rate of is in effect for all years. One hundred thousand common shares were outstanding each year. Income from continuing operations was $ in and $ in There were no discontinued operations either year. Required: Prepare the journal entry at January to record the change in accounting principle. All tax effects should be reflected in the deferred tax liability account. Prepare the comparative income statements beginning with income from continuing operations adjusted for any revisions Include per share amounts.
The CecilBooker Vending Company changed its method of valuing inventory from the average cost method to the FIFO cost method at the beginning of At December inventories were $average cost basis and were $ a year earlier. CecilBookers accountants determined that the inventories would have totaled $ at December and $ at December if determined on a FIFO basis. A tax rate of is in effect for all years.
One hundred thousand common shares were outstanding each year. Income from continuing operations was $ in and $ in There were no discontinued operations either year.
Required:
Prepare the journal entry at January to record the change in accounting principle. All tax effects should be reflected in the deferred tax liability account.
Prepare the comparative income statements beginning with income from continuing operations adjusted for any revisions Include per share amounts.
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