23. When the cost-of-goods-sold method is used to record inven a. there is a direct reduction in the selling price of the product that b. a loss may be recorded directly in the inventory account by crediting Inventery ord c. only the portion of the loss attributable to inventory sold during the periods d. the market value (NRV) amount for ending inventory is su e. the loss is reported as part of "Other Income and Expenses" (below Operating tory at net realizable value being recorded on the income statement prior to the sale. debiting Loss Due to Decline of Inventory to NRV. recorded in the financial statements loss is buried in cost of goods sold. Income) on the income statement. results in a loss the Crafty Co. uses an allowance account to adjust inventory to the lower of cost or net realizable value. The following information is available for Crafty Co. for the last three years: 24. Date 12/31/16 12/31/17 Inventory at Cost $376,000 388,000 346,000 Inventory at NRV $352,000 374,000 348,000 12/31/18 Assuming Crafty uses the loss method, the adjusting Journal entry on 12/31/18 would include a. debit Loss Due to Decline of Inventory to NRV 2,000 b. debit Allowance to Reduce Inventory to NRV $2,000 c, debit Allowance to Reduce Inventory to NRV 26,000 d. credit Recovery of Loss Due to Inventory Valuation $28,000 e. debit Allowance to Reduce Inventory to NRV $14,000 25. Antique Jewelry Company purchases its inventory in bulk from estate sales. In a llocated purchase, the company paid $180,000 and received 850 pieces of jewelry that are a among three groups. Group 1 consists of 250 pieces that are expected to sell for an average of $150 each. Group 2 consists of 550 pieces that are expected to sell for an average of $360 each. Group 3 consists of 50 pieces that are expected to sell for an average of $720 each. Using the relative sales value method, what will be the gross profit if AJC sells all items from Group 3 at the average expected price? Round percentages to two decimal places (ea.02651933:26.52%). a. ($69,372) b. $12,132 c. $23,868 d $25,416 e. $32,400