7. The Pyramid Company has used the LIFO method of accounting for inventory during its first two years of operation, 2014 and 2015. At the beginning of 2016, Pyramid decided to change to the average cost method for both tax and financial reporting purposes. The following table presents information concerning the change for 2014-2016. The income tax rate for all years is 40%. before Income Tax Average Cost Method 94,200 Tax Effect $12,560 3,880 $18,840 5,820 2014 2015 62,800 38,800 31,400 9,700 Total s142,700 $101,600 $41,100 $16,440 $24,660 201652,400 $ 46,700 $ 5,700 s 2,280 3,420 Pyramid issued 58,000 $1 par, common shares for $265,000 when the business began, and there have been no changes in dividends were paid in both 2015 and 2016. paid-in capital since then. Dividends were not paid the first year, but $11,000 cash Required 1. Prepare the journal entry to record the change in accounting principle. (if no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet esc F3 ODD FA F5 2 4