The Pyramid Company has used the LIFO method of accounting for inventory during its first two years of operation, 2014 and 2015. At the beginning of 2016, Pyramid decided to change to the average cost method for both tax and financial reporting purposes. The following table presents information concerning the change for 2014-2016. The income tax rate for all years is 40%. Income before Income Tax Average Cost Income Difference Method LIFO Method 96,000 64,000 Difference Tax Effect after Tax 32,000 2014 12,800 19,200 50,000 40,000 4,000 2015 10,000 6,000 146,000 $104,000 42,000 16,800 25,200 Tota 53,000 47,000 6,000 2,400 3,600 2016 Pyramid issued 60,000 $1 par, common shares for $280,000 when the business began, and there have been no changes in paid-in capital since then. Dividends were not paid the first year, but $11,000 cash dividends were paid in both 2015 and 2016. Required: 1. Prepare the journal entry to record the change in accounting principle. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) view transaction list view general journal Journal Entry Worksheet Record the change in accounting principle Debit Credit Event General Journal