Joe Merando, the president of Lane Company, is pleased. Lane substantially increased its net income in 2014 while keeping its unit inventory relatively the same. Donald Jantz, chief accountant, cautions Joe, however. Jantz says that since Lane changed its method of inventory valuation, there is a consistency problem and it is difficult to determine whether Lane is better off. Is Jantz correct?

Why or why not?

AppendixLO1