P21.4 (LO 2) Groupwork Ethics (Accounting Changes) Aston plc performs year-end planning in November of each year before its calendar year ends in December. The preliminary estimated net income is £3 million. The CFO, Rita Warren, meets with the company president, J. B. Aston, to review the projected numbers. She presents the following projected information.

Aston plc Projected Income Statement For the Year Ended December 31, 2025 Sales £29,000,000 Cost of goods sold £14,000,000 Depreciation 2,600,000 Operating expenses 6,400,000 23,000,000 Income before income tax 6,000,000 Income tax 3,000,000 Net income £ 3,000,000 Aston plc Selected Statement of Financial Position Information At December 31, 2025 Estimated cash balance £ 5,000,000 Debt investments (held-for-

collection)

10,000,000 Security fair value adjustment account (1/1/25) 200,000 Instructions Prepare comparative statements for the 5 years, assuming that Utrillo changed its method of inventory costing to average-cost. Indicate the effects on net income and earnings per share for the years involved.
Utrillo Instruments started business in 2020. (All amounts except EPS are rounded up to the nearest yen.)