Below is the net income of Sheffield Instrument Co., a private corporation, computed under the three inventory methods using a periodic system.

FIFO Average Cost LIFO

2018 $26,400 $23,100 $20,900

2019 27,000 22,200 17,200

2020 27,500 25,700 22,100

2021 32,800 29,100 24,400

(Ignore tax considerations.)

(a) Assume that in 2021 Sheffield decided to change from the FIFO method to the average-cost method of pricing inventories. Prepare the journal entry necessary for the change that took place during 2021, and show net income reported for 2018, 2019, 2020, and 2021. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Account Titles and Explanation Debit Credit

2021 2020 2019 2018

Net income $ $ $ $

(b) Assume that in 2021 Sheffield, which had been using the LIFO method since incorporation in 2018, changed to the FIFO method of pricing inventories. Prepare the journal entry necessary to record the change in 2021 and show net income reported for 2018, 2019, 2020, and 2021. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Account Titles and Explanation Debit Credit

2021 2020 2019 2018

Net income $ $ $ $