Presented below are income statements prepared on a LIFO and FIFO basis for Novak Company, which started operations on January 1, 2016. The company presently uses the LIFO method of pricing its inventory and has decided to switch to the FIFO method in 2017. The FIFO income statement is computed in accordance with the requirements of GAAP. Novaks profit-sharing agreement with its employees indicates that the company will pay employees 10% of income before profit-sharing. Income taxes are ignored.

		LIFO Basis				FIFO Basis
		2017		2016		2017		2016
Sales		$2,910		$2,910		$2,910		$2,910
Cost of goods sold		1,130		1,040		1,050		990
Operating expenses		1,050		1,050		1,050		1,050
Income before profit-sharing		730		820		810		870
Profit-sharing expense		73		82		86		82
Net income		$657		$738		$724		$788

Answer the following questions.

If comparative income statements are prepared, what net income should Novak report in 2016 and 2017? (Round answers to 0 decimal places, e.g. 125.)

		2017		2016
Net income		$		$

Assume that Novak has a beginning balance of retained earnings at January 1, 2017, of $738 using the LIFO method. The company declared and paid dividends of $480 in 2017. Prepare the retained earnings statement for 2017, assuming that Novak has switched to the FIFO method