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At December 31, 2012, Ashley Co. has outstanding purchase commitments for $150,000 gallons, at $6.20 per gallon, of a raw material to be used in

At December 31, 2012, Ashley Co. has outstanding purchase commitments for $150,000 gallons, at $6.20 per gallon, of a raw material to be used in its manufacturing process. The company prices its raw material inventory at cost or market, whichever is lower. Assuming that the market price as of December 31, 2012, is $5.90, how would you treat this situation in the accounts

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