Exercise 22-03 Flounder Co. decides at the beginning of 2020 to adopt the FIFO method of inventory valuation. Flounder had used the LIFO method for financial reporting since its inception on January 1, 2018, and had maintained records adequate to apply the FIFO method retrospectively Flounder concluded that FIFO is the preferable inventory method because it reflects the current cost of inventory on the balance sheet. The following table presents the effects of the change in accounting principles on inventory and cost of goods sold. Income taxes are ignored. Cost of Goods Sold Determined by Date January 1, 2018 December 31, 2018 December 31, 2019 December 31, 2020 Inventory Determined by LIFO FIFO Method Method $ 0 $ 0 110 9 200 260 320 400 LIFO Method $ 0 750 940 1,150 FIFO Method $ 0 851 779 1,130 Retained earnings reported under LIFO are as follows. December 31, 2018 December 31, 2019 December 31, 2020 Retained Earnings Balance $1,090 1,990 2,680 Other information: 1. For each year presented, sales are $2,770 and operating expenses are $930. 2. Flounder provides two years of financial statements. Earnings per share information is not required