Shark Trade Mart has recently had lackluster sales. The rate of inventory turnover has dropped, and the merchandise is gathering dust. At the same time, competition has forced Shark's suppliers to lower the prices that Shark will pay when it replaces its inventory. It is now December 31, 2018, and the net realizable value of Shark's ending inventory is $80,000 below what the company actually paid for the goods, which was $260,000. Before any adjustments at the end of the period, the Cost of Goods Sold account has a balance of $730,000 Read the requirements Requirement a. What accounting action should Shark take in this situation? Shark should apply the lower-of-cost-or-market rule to account for inventories. The net realizable value of ending inventory is less than Shark's actual cost, so Shark must write the inventory down to net realizable value. Requirement b. Give any journal entry required. (Record debits first, then credits. Exclude explanations from any journal entries. If no entry is required, select "No entry required" in the first cell in the "Accounts" column and leave all other cells blank.) Journal Entry Requirements x Date Accounts Debit Credit Dec 31 a. What accounting action should Shark take in this situation? b. Give any journal entry required. c. At what amount should the company report Inventory on the balance sheet? d. At what amount should the company report Cost of Goods Sold on the income statement? e. Discuss the accounting principle or concept that is most relevant to this situation