At 12/31/20, the end of Wildhorse Company's first year of business, inventory was $6,500 and $5,100 at cost and at market, respectively. Following is data relative to the 12/31/21 inventory of Jenner: Original Cost Replacement Item Per Unit Cost A $0.85 $0.35 B 0.40 0.35 C 0.65 0.70 D 0.80 0.70 E 0.70 0.65 Selling price is $1.00/unit for all items. Disposal costs amount to 10% of selling price and a "normal" profit is 30% of selling price. There are 1,500 units of each item in the 12/31/21 inventory. Prepare the entry at 12/31/20 necessary to implement the lower-of-cost-or-market procedure assuming Wildhorse uses a contra account for its balance sheet. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Date Account Titles and Explanation 2/31/20 Loss Due to Decline of Inventory to Market Debit 1400 Credit Click to add not Prepare the entry at 12/31/20 necessary to implement the lower-of-cost-or-market procedure assuming Wildhorse uses a contra account for its balance sheet. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit 12/31/20 Loss Due to Decline of Inventory to Market Allowance to Reduce Inventory to Market 1400 Credit 1400 Complete the last three columns in the 12/31/21 schedule below based upon the lower-of-cost-or-market rules. Original Cost Item Per Unit Replacement Cost Net Realizable Value Net Realizable Value A $0.85 $0.35 $ B 0.40 0.35 0.65 0.70 0.80 0.70 Less Normal Profit $ Click to add no Complete the last three columns in the 12/31/21 schedule below based upon the lower-of-cost-or-market rules. Item Original Cost Per Unit Replacement Cost Net Realizable Value Net Realizable Value Less Normal Profit A $0.85 $0.35 B 0.40 0.35 C D E $ 0.65 0.70 0.80 0.70 0.70 0.65 I S Date Account Titles and Explanation 12/31/21 Allowance to Reduce Inventory to Market Cost of Goods Sold (To record cost of goods sold) 12/31/21 Loss Due to Decline of Inventory to Market Allowance to Reduce Inventory to Market (To record profit/ loss) How are inventory losses disclosed on the income statement? Debit Credit 13 Inventory losses can be disclosed separately below gross profit in operating expenses or they can be shown as part of