In 2018, the Barton and Barton Company changed its method of valuing inventory f

Question

In 2018, the Barton and Barton Company changed its method of valuing inventory from the FIFO method to the average cost method. At December 31, 2017, B & B’s inventories were $31.2 million (FIFO). B & B’s records indicated that the inventories would have totaled $23.4 million at December 31, 2017, if determined on an average cost basis.

Ignoring income taxes, what journal entry will B & B use to record the adjustment in 2018? (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions rounded to 1 decimal place (i.e., 5,500,000 should be entered as 5.5).)

Explanation / Answer

Journal Entry Date Particulars Dr. Amt. Cr. Amt. 1 Retained Earnings           7.80 $31.20 Million - $23.40 Million    Inventory           7.80 (Record the adjustment entry)

Related Questions

Navigate

• Browse (All)
• Browse I
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.