Sunland Incorporated decided to change from the FIFO method of valuing inventory to the weighted average method in July $2023$ to

present more relevant information for its financial statement users. The cumulative effect on prior years of a retrospective application

of the new inventory costing method was determined to be $$23,500$ net of $$8,000$ tax. As prices were decreasing, cost of goods sold is

lower and ending inventory higher for the preceding period. Retained earnings on January $1,2023$ was $$245,500.$ Sunland follows

ASPE.

Prepare a partial statement of retained earnings illustrating the adjusted balance of retained earnings.

Sunland Incorparated

Statement of Retained Earnings $($Partial$)$

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$

eTextbook and Media

List of Accounts

Prepare the adjusting journal entry for the change in the accounting policy. $($List all debit entries before credit entries. Credit account

titles are automatically indented when the amount is entered. Do not indent manually.$)$

Account Titles and Explanation

Debit

Credit