Applying LCNRV, NeCo determines that as of December 31, 20X3, merchandise that originally cost $46,300 is now $43,500 at NRV.

48. Early in 20X4, the market value of NeCo's inventory unexpectedly increases to $47,500. If the original credit to write-down inventory was to the Inventory account, NeCo should . .. a. recognize a $4,000 gain. b. recognize a $2,800 gain. c. make no entry but disclose the loss in a note accompanying the fi- nancial statements. d. make no entry and make no disclosure