Millington Materials is a leading supplier of building equipment, building products, materials, and timber for sale, with over 200 branches across the Mid South On January 1, 2021, management decided to change from the average inventory costing method to the FIFO inventory costing method at each of its outlets The following table presents information concerning the change The income tax rate for all years is 25 Income before Income Tax FIFO Average Cost Difference Before 2020 $ 110 million $ 56 million $ 54 million 2020 96 million 50 million 46 million 2021 100 million 58 million 42 million Required 1 Prepare the journal entry to record the change in accounting principle 2 Determine the net income to be reported in the 20212020 comparative income statements 4 Indicate the affect of the change in the 20212020 comparative statements of shareholders equity assuming cash dividends were $12 00 million each year and that no dividends were paid prior to 2020

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Millington Materials is a leading supplier of building equipment, building products, materials, and timber for sale, with over 200 branches across the Mid-South. On January

Millington Materials is a leading supplier of building equipment, building products, materials, and timber for sale, with over 200 branches across the Mid-South. On January 1, 2021, management decided to change from the average inventory costing method to the FIFO inventory costing method at each of its outlets. The following table presents information concerning the change. The income tax rate for all years is 25%.

	Income before Income Tax
	FIFO			Average Cost			Difference
Before 2020	$	110	million	$	56	million	$	54	million
2020		96	million		50	million		46	million
2021		100	million		58	million		42	million

Required: 1. Prepare the journal entry to record the change in accounting principle. 2. Determine the net income to be reported in the 20212020 comparative income statements. 4. Indicate the affect of the change in the 20212020 comparative statements of shareholders equity assuming cash dividends were $12.00 million each year and that no dividends were paid prior to 2020.