During 2008, All Seasons Company changed its inventory valuation method from LIFO to FIFO. The following information shows the effect of this change.

Instructions:
1. Before the change from LIFO to FIFO, the Retained Earnings balance on January 1, 2006, was $300,000. All Seasons Company does not pay any dividends. Prepare the comparative statement of retained earnings, reflecting the change to FIFO, for 2006, 2007, and 2008.
2. What additional information would you need to prepare all the necessary disclosures to include in the notes to the 2008 financialstatements?

Transcribed Image Text:

Net Income Computed Using LIFO Excess of LIFO Cost of Goods Sold over FIFO Cost of Goods Sold Income Effect (Net of Tax) Year Prior to 2006 2006 2007 2008 $72,000 22,000 24.000 50,000 $43.200 3,200 14,400 30,000 $140,000 .130.000 200,000