Donny home Improvement Company installs replacement siding, windows, and louvered glass doors for single-family homes and condominium complexes. The company is in the process of preparing its annual financial statements for the fiscal year ended May 31, 2020. Tom Cruise, controller for Concord, has gathered the following data concerning inventory. At May 31, 2020, the balance in Donnys Raw Materials Inventory account was $444,720, and Allowance to Reduce Inventory to Market had a credit balance of $27,250. Alcide summarized the relevant inventory cost and market data at May 31, 2020, in the schedule below. Tom assigned Patricia Chrid F, an intern from a local college, the task of calculating the amount that should appear on Donnys May 31, 2020, financial statements for inventory at lower-of-cost-or-market as applied to each item in inventory. expressed Chris concern over departing from the historical cost principle. Assume Tom uses LIFO inventory costing.

		Cost		Replacement Cost			Sales Price			Net Realizable Value			Normal Profit
Aluminum siding		$76,300		$68,125			$69,760			$61,040			$5,559
Cedar shake siding		93,740		86,546			102,460			92,432			8,066
Louvered glass doors		122,080		135,160			203,176			183,447			20,165
Thermal windows		152,600		137,340			168,732			152,600			16,786
Total		$444,720		$427,171			$544,128			$489,519			$50,576

(a1) Determine the proper balance in Allowance to Reduce Inventory to Market at May 31, 2020.

Balance in the Allowance to Reduce Inventory to Market

$

(a2) For the fiscal year ended May 31, 2020, determine the amount of the gain or loss that would be recorded due to the change in Allowance to Reduce Inventory to Market.

The amount of the gain (loss)

$

Can you please show your work? I'm getting lost in this problem.