单选题 In 2005, Carpet Company decides to change from the straight-line method of depreciation to the sum of the year' s digits method. The following information is available :

	Pre-2005	2005
Straight Line Depreciation	$ 1600000	$ 400000
Sum of the Years Digits	$ 2300000	$ 500000

On its 2005 financial statements, Carpet will report: A. $ 400000 depreciation expense in the 2005 income statement and $ 800000 separately as a change in accounting principle net of taxes. B. $ 500000 depreciation expense in the 2005 income statement and $ 700000 separately as a change in accounting principle net of taxes. C. $1200000 depreciation expense in the 2005 income statement and include a footnote of explanation including the tax effect.

【正确答案】 B

【答案解析】A change in depreciation method retroactively applied is a change in accounting method and must be separately disclosed on the income statement net of taxes. The amount of the disclosure is ( $ 2300000 - $1600000 = ) $ 700000 relating to the prior periods. The change from $ 400000 to $ 500000 in current depreciation is current and does not require separate disclosure.