Black Hoe Construction changed from the completed-contract to the percentage-of-completion method of accounting for long-term construction contracts during 2015. For tax purposes, the company employs the completed-contract method and will continue this approach in the future. The appropriate information related to this change is as follows.

Instructions
(a) Assuming that the tax rate is 40%, what is the amount of net income that would be reported in 2015?
(b) What entry(ies) are necessary to adjust the accounting records for the change in accountingprinciple?

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mpleties octDiterence Percentage of Comeletion$ 25,000 00 000 Pretax Income from: 2014 2015 $125,000 360,000 Completed-Contract Difference $100,000 160,000 200,000