Titan Offroad Equipment uses the LIFO inventory method and values its inventory using the lower-of-cost-or-market^LCM) rule. Titan Offroad Equipment has the following account balances at December 31, 2010, prior to releasing the financial statements for the year:

The accountant for Titan Offroad Equipment has determined that the replace¬ ment cost (current market value) of the ending inventory as of December 31, 2010, is $58,300.
Requirements 1. Which accounting principle or concept is most relevant to Titan Offroad Equipment’s decision to utilize LCM?
2. What value would Titan Offroad Equipment report on the balance sheet at December 31,2010, for inventory?
3. Prepare any adjusting journal entry required from the information given.

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Inventory Beg Bal 54,300 End Bal 61,100 Cost of Goods Sold Sales Revenue Bal 258,600 Bal 419,500