A SBE taxpayer conducts a business as a retailer and performs a stock take that values the stock at year end 2023 as $88,000.

The prior year, using the same method of valuation, the stock take valued stock at $84,000 at year end 30 June 2022.

From the above information, identify the option below that will minimise the taxpayer's taxable income.

Select one:

a.

The taxpayer uses the closing stock from 2022 for 2023 - no change necessary to account for the change in value

b.

The taxpayer uses the closing stock for 2022 - and claims a deduction of $4,000 to reflect the change in value

c.

The taxpayer uses the closing stock for 2022 - and includes income of $4,000 to reflect the change in value