November 1 of the current year, a company entered into a purchase contract (not subject to revision or cancellation) to purchase 900 units of inventory for $50 per unit before January 31 of the following year. On November 1, the contract price was equal to the market price. The company measures the cost of inventory using the LIFO inventory method. a. If the inventory has a market price of $40 per unit on December 31, what entry (if any) does the company record on that date when preparing financial statements? b. Record the purchase of 900 units on January 15, if the market price remained at $40 per unit. Assume that the company uses a perpetual inventory system. a. Estimated Loss on Purchase Commitment Account Name Estimated Liability on Purchase Commitment To record the purchase contract. Dr. Cr. 9,000 0 9,000 b. Inventory Cash To record the purchase of inventory. 36,000 0 0 9,000 * 0 0 x