For financial reporting, Kumas Poultry Farms has used the declining-balance method of depreciation for conveyor equipment acquired at the beginning of 2021 for $2,560,000. Its useful life was estimated to be six years with a $160,000 residual value. At the beginning of 2024, Kumas decides to change to the straight-line method. The effect of this change on depreciation for each year is as follows:

Required:
1. Will Kumas apply the straight-line method retrospectively or apply the straight-line method prospectively?
2. Prepare any 2024 journal entry related to the change.

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Year 2021 2022 2023 Straight-Line $ 400 400 400 $1,200 ($ in thousands) Declining Balance $ 853 569 379 $1,801 Difference $453 169 (21) $601