Ryan Distribution Co. has determined its December 31, 2012 inventory on a FIFO basis at $500,000. Information pertaining to that inventory follows:

Estimated selling price $510,000

Estimated cost of disposal $20,000

Normal profit margin $60,000

Current replacement cost $450,000

Ryan records losses that result from applying the lower-of-cost-or-market rule. At December 31, 2012, the loss that Ryan should recognize (Under US GAAP) is

a. $0.

b. $10,000.

c. $40,000.

d. $50,000.

Ryan records losses that result from applying the lower-of-cost-or-market rule. At December 31, 2012, the loss that Ryan should recognize (Under IFRS) is

a. $0.

b. $10,000.

c. $40,000.

d. $50,000.