Stone Company changed its method of pricing inventories from average cost to FIFO.What type of accounting change does this represent?
A)A change in accounting estimate for which the financial statements for prior periods included for comparative purposes should be presented as previously reported.
B)A change in accounting policy for which the financial statements for prior periods included for comparative purposes should be presented as previously reported.
C)A change in accounting estimate for which the financial statements for prior periods included for comparative purposes should be restated.
D)A change in accounting policy for which the financial statements for prior periods included for comparative purposes should be restated.

Question

Quizplus · Accepted Answer

Changing the method of inventory pricing from average cost to FIFO is a change in accounting policy, and prior period financial statements should be restated to reflect this change for comparability.

Stone Company Changed Its Method of Pricing Inventories from Average