Finish attempt ... Question 6 Not complete Marked out of 5.00 Flag question Change in Inventory Methods: Entries and Reporting Pier2 Company computed net income under the following two inventory methods for the recent four years, listed chronologically. Ignore income taxes. Net Income Using Average Cost FIFO Calendar Year Year 1 Year 2 Year 3 Year 4 Inventory Inventory $396,000 $429,000 407,000 418,000 418,000 440,000 440,000 451,000 Note: If a journal entry isn't required on any of the dates shown for the requirements below, select "N/A-debit" and "N/A-credit" as the account names and leave the Dr. and Cr. answers blank (zero). Average Cost to FIFO FIFO to Average Cost FIFO to LIFO a. Prepare the journal entry on January 1 of Year 4, assuming the company changed from average cost to FIFO at the beginning of Year 4. Date Jan. 1, Year 4 Inventory Retained Earnings Account Name To record accounting change. Dr. Cr. 0 0 b. Assuming the change in part a, compute net income only as reported in comparative income statements for Year 4, Year 3, and Year 2. Income Statement Net income Year 4 $ 0 $ Year 3 0 $ Year 2 0