Exercise 22B-3 (Part Level Submission) Pronghorn Co. decides at the beginning of 2017 to adopt the FIFO method of inventory valuation. Pronghorn had used the LIFO method for financial reporting since its inception on January 1, 2015, and had maintained records adequate to apply the FIFO method retrospectively. Pronghorn 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 Inventory Determined by Cost of Goods Sold Determined by LIFO Method FIFO Method Date January 1, 2015 December 31, 2015 December 31, 2016 December 31, 2017 LIFO Method FIFO Method 100 210 320 8 260 390 780 1,100 1,250 872 958 1,230 Retained earnings reported under LIFO are as follows Retained Earnings Balance December 31, 2015 December 31, 2016 December 31, 2017 $1,420 2,520 3,470