Please answer the following question and/or draft a memorandum with recommendations for Hannah.

45. Hannah Idaho, a sole proprietor, is required to change her accounting method for inventories following an IRS audit of their 2013 tax return. Hannah had been using the incorrect method for the past five years, and the proposed Code Sec. 481 involuntary adjustment of $40,000 is composed of the following amounts: 2009 2010 2011 2012 2013 Total Positive (Negative) (S 2,000) S 5,000 s 8,om $14,000 Hannah's Marginal Tax Rate Adjustment 35% How should Hannah handle the reporting ofthis adjustment? Explain. (Hint: refer to Code Sec. 481 I ) and (b2)).