Kingbird 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, 2017. Jim Alcide, controller for Kingbird, has gathered the following data concerning inventory. At May 31, 2017, the balance in Kingbirds Raw Materials Inventory account was $485,520, and Allowance to Reduce Inventory to Market had a credit balance of $27,470. Alcide summarized the relevant inventory cost and market data at May 31, 2017, in the schedule below. Alcide assigned Patricia Devereaux, an intern from a local college, the task of calculating the amount that should appear on Kingbirds May 31, 2017, financial statements for inventory at lower-of-cost-or-market as applied to each item in inventory. Devereaux expressed concern over departing from the historical cost principle. Assume Garcia uses LIFO inventory costing.

		Cost		Replacement Cost			Sales Price			Net Realizable Value			Normal Profit
Aluminum siding		$83,300		$74,375			$76,160			$66,640			$6,069
Cedar shake siding		102,340		94,486			111,860			100,912			8,806
Louvered glass doors		133,280		147,560			221,816			200,277			22,015
Thermal windows		166,600		149,940			184,212			166,600			18,326
Total		$485,520		$466,361			$594,048			$534,429			$55,216

(a1) Determine the proper balance in Allowance to Reduce Inventory to Market at May 31, 2017.

(a2) For the fiscal year ended May 31, 2017, determine the amount of the gain or loss that would be recorded due to the change in Allowance to Reduce Inventory to Market.