The Rockwell Corporation uses a periodic inventory system and has used the FIFO cost method since inception of the company in 1974. In 2011, the company decided to change to the average cost method. Data for 2011 are as follows:

Additional information:

1. The company's effective income tax rate is 40% for all years.

2. If the company had used the average cost method prior to 2011, ending inventory for 2010 would have been $130,000.

3. 7,000 units remained in inventory at the end of 2011.

Required:

1. Prepare the journal entry at the beginning of 2011 to record the change in principle.

2. In the 2011–2009 comparative financial statements, what will be the amounts of cost of goods sold and inventory reported for 2011?