OK I've got another one for you!
Jan. 2/07 Comp A adopted the accounting principle of expensing advertising and promotion costs as they're incurred.
Previously, advertising and promotion costs applicable to future periods were recorded in prepaid expenses. Comp A can justify the change, which was made for both financial statement and income tax reporting purposes. Prepaid advertising and promotion costs totaled $250,000 at Dec. 31/06. Income tax rate is 40% for both 2006 and 2007.
The adjustment for the effect of the change in accounting principle should result in a net charge against income in the 2007 income statement of...
a) $100,000
b) $150,000
c) $250,000

If you can help with this thanks, if not, thanks!