The principle of consistency prohibits a company from changing an inventory valuation method once one is selected.

Name: The principle of consistency prohibits a company from changing an inventory valuation method once one is selected.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

The principle of consistency encourages companies to apply the same accounting methods period over period to ensure comparability of financial statements, but it does not prohibit changing methods. Changes are allowed but must be disclosed and justified.

The Principle of Consistency Prohibits a Company from Changing an Inventory