eBook Calculator Brief Exercise 6-37 (Algorithmic) Lower of Cost or Market Garcia Company uses FIFO, and its inventory at the end of the year was recorded in its accounting records at $63,300. Due to technological changes in the market, Garcia would be able to replace its inventory for $56,970. Required: 1. Using the lower of cost or market method, what amount should Garcia report for inventory on its balance sheet at the end of the year? 2. Prepare the journal entry required to value the inventory at the lower of cost or market. Dec. 31 (Inventory adjustment to market value)