Bryant Construction Company changed from the completed-contract to the percentage-of-completion method of accounting for long-term construction contracts during 2010. 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.

Pretax Income from:
Percentage of Completion Completed Contract Difference
2009 $972,200 $745,700 $226,500
2010 922,700 493,100 429,600

Instructions

(a) Assuming that the tax rate is 40%, what is the amount of net income that would be reported in 2010? $

(b) What entry is necessary to adjust the accounting records for the change in accounting principle? (For multiple debit/credit entries, list amounts from largest to smallest eg 10, 5, 3, 2.)