Q78
Single choice
Goddard has used the FIFO method of inventory valuation since it began operations in 1987. Goddard
decided to change to the weighted-average method for determining inventory costs at the beginning of
1990. The following schedule shows year-end inventory balances under the FIFO and weighted-average methods:
What amount, before income taxes, should be reported in the 1990 retained earnings statement as the cumulative effect of the change in accounting principle?