Westside Copiers Ltd. has recently been plagued with lacklustre sales. The rate of inventory turnover has dropped, and some of the company's merchandise is gathering dust. At the same time, competition has forced some of Westside's suppliers to lower the prices that Westside will pay when it replaces its inventory. It is now December 31, 2020. The current net realizable value of Westside's ending inventory is \(\$ 6,800,000\), which is far less than the amount Westside paid for the goods, \(\$ 8,900,000\). Before any adjustments at the end of the period, Westside's Cost of Goods Sold account has a balance of \(\$ 36,400,000\).

Identify and explain how accounting standards apply to inventory. Include in your answer how the information that is relevant to inventory is reported in Westside's financial statements