Jaffa Company prepared its annual financial statements dated December 31 of the current year. The company applies the FIFO inventory costing method; however, the company neglected to apply lower of cost or net realizable value to the ending inventory. The preliminary current year income statement follows: Sales revenue Cost of goods sold Beginning inventory Purchases Goods available for sale Ending inventory (FIFO cost) Cost of goods sold Gross profit Operating expenses Pretax income Income tax expense (358) Net income $293,000 $ 34,300 197,000 231,300 61,661 169,639 123,361 63,300 60,061 21,021 $ 39,040 Assume that you have been asked to restate the current year financial statements to incorporate lower of cost or NRV. You have developed the following data relating to the current year ending inventory: Acquisition Cost Item ABCD Quantity 3,180 Unit Total $4.30 1,630 3.80 7,230 3.80 $ 13,674 6,194 27,474 3,330 4.30 14,319 $ 61,661 Net Realizable Value Per Unit $ 3.30 5.30 1.80 6.30