On May 31, 2022, the balance in GW Cos Raw Materials Inventory account was 408,000, and the Allowance to Reduce Inventory to NRV had a credit balance of 27,500.

	Cost	Sales Price	Net Realizable Value
Aluminum siding	70,000	64,000	56,000
Cedar shake siding	86,000	94,000	84,800
Louvered glass doors	112,000	186,400	168,300
Thermal windows	140,000	154,800	140,000
Total	408,000	499,200	449,100

Instructions

1. Calculate the amount that should appear on GWs May 31, 2022, financial statements for inventory under the LCNRV rule as applied to each item in inventory.

2. Determine the proper balance in Allowance to Reduce Inventory to Net Realizable Value on May 31, 2022.

3. For the fiscal year ended May 31, 2022, determine the amount of the gain or loss that would be recorded (using the loss method) due to the change in Allowance to Reduce Inventory to Net Realizable Value.