Sheffield 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 Sheffield, has gathered the following data concerning inventory. At May 31, 2017, the balance in Sheffields Raw Materials Inventory account was $497,760, and Allowance to Reduce Inventory to Market had a credit balance of $26,160. 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 Sheffields 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.

Replacement Cost			Sales Price			Net Realizable Value			Normal Profit
Aluminum siding		$85,400		$76,250			$78,080			$68,320			$6,222
Cedar shake siding		104,920		96,868			114,680			103,456			9,028
Louvered glass doors		136,640		151,280			227,408			205,326			22,570
Thermal windows		170,800		153,720			188,856			170,800			18,788
Total		$497,760		$478,118			$609,024			$547,902			$56,608

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

Balance in the Allowance to Reduce Inventory to Market: $

(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. The amount of the gain (loss): $