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.

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The following table presents information concerning the change. The

income tax rate for all years is $25\%.$

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 $$2$ million each year and that no dividends were

paid prior to $2020.$