Part 1: At the beginning of 2018, Park Industries ownership interest in the common stock of Kim Company increased to the point that it became appropriate to begin using the equity method of accounting for the investment. The balance in the investment account was $44 million at the time of the change but would have been $56 million if Park had used the equity method since first investing in Kim.

1. How should Park report the change?

2. Would your answer be the same if Park is changing from the equity method rather than to the equity method?