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During 2019 (its first year of operations) and 2020. Fleri Foods used the FIFO inventory costing method for both financial reporting and tax purposes. At

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During 2019 (its first year of operations) and 2020. Fleri Foods used the FIFO inventory costing method for both financial reporting and tax purposes. At the beginning of 2021. Fleri decided to change to the average method for both financial reporting and tax purposes. Income components before income tax for 2019, 2020, and 2021 were as follows: (5 in millions) Revenues Cost of foods sold (FIFO) Cost of goods sold (averate) Operating expenses 2019 2020 2021 $460 $ 470 $500 (46) (48) (54) (68) (72) (78) (274) (202) (286) Dividends of $27 million were paid each year Fieri's fiscal year ends December 31 Required: 1. Prepare the Journal entry at the beginning of 2021 to record the change in accounting principle. (Ignore Income taxes.) 2. Prepare the 2021-2020 comparative income statements 3. & 4. Determine the balance in retained earnings at January 1, 2020 as Fler reported using FIFO method and determine the adjustment of balance in retained earnings as on January 1, 2020 using average method instead of FIFO method. Journal entry worksheet Reg 1 Reg 2 Reg 3 and 4 Prepare the 2021-2020 comparative Income statements. (Enter your answers in millions (1.e., 10,000,000 should be entered as 10.) COMPARATIVE INCOME STATEMENTS 2021 2020 ($ in millions) Determine the balance in retained earnings at January 1, 2020 as Fieri reported using FIFO method and determine the adjustment of balance in retained earnings as on January 1, 2020 using average method instead of FIFO method. (Enter your answers in millions (e., 10,000,000 should be entered as 10). ($ in millions) Retained earnings balance previously reported using FIFO, Jan 1, 2020 Adjustment to balance for change in inventory methods Retained earnings balance using average method, Jan 1, 2020

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