Exercise $20-1($Algo$)$ Change in principle; change in inventory methods $[$LO$20-2]$

During $2022($its first year of operations$)$ and $2023,$ Fieri Foods used the FIFO inventory costing method for both financial reporting

and tax purposes. At the beginning of $2024,$ Fieri decided to change to the average method for both financial reporting and tax purposes.

Income components before income tax for $2022,2023,$ and $2024$ were as follows:

Dividends of $\backslash (\backslash$$ $21\backslash )$ million were paid each year. Fieri's fiscal year ends December $31.$

Required:

$1.$ Prepare the journal entry at the beginning of $2024$ to record the change in accounting principle. $($Ignore income taxes.$)$

$2.$ Prepare the $2024-2023$ comparative income statements.

$3.\backslash$& $4.$ Determine the balance in retained earnings at January $1,2023,$ as Fieri reported using FIFO method and determine the adjustment of balance in retained earnings as on January $1,2023$ using average method instead of FIFO method.

Answer is complete but not entirely correct.

Complete this question by entering your answers in the tabs below.

Req $1$

Determine the balance in retained earnings at January $1,2023,$ as Fieri reported using FIFO method and determine the adjustment of balance in retained earnings as on January $1,2023$ using average method instead of FIFO method.

Note: Enter your answers in millions $($i$.$e$.,10,000,000$ should be entered as $10).$