At December 31, the Selig Company has ending inventory with a historical cost of $633,000. Assume the company uses the FIFO perpetual inventory system. The net realizable value is $617,000. The normal profit on this inventory is $50,000. Before any adjustments at the end of the period, the cost of goods sold account has a balance of $900,000. Following U.S. GAAP, which journal entry is required on December 31 to adjust the ending balance of inventory if the direct method is used?

At December 31, the Selig Company has ending inventory with a historical cost of $633,000. Assume the company uses the FIFO perpetual inventory system. The net realizable value is $617,000. The normal profit on this inventory is $50,000. Before any adjustments at the end of the period, the cost of goods sold account has a balance of $900,000. Following U.S. GAAP, what is the journal entry is required on December 31 to adjust the ending balance of inventory if the direct method is used?