Watters experience a S50,000 decline in the market value of its inventory in the first quarter of its fiscal year. Watters had expected this decline to reverse in the third quarter, in fact, the thrid quater recovery exceeded the previous decline by S10,000. Watters inventory did not experience any other declines in market value during the fiscal year. What amounts of loss and/or gain should Watters report in its interim financial statements for the first and third quarters?

O S50,000 loss in first quarter, S50,000 gain in third quarter

O SO in first and third quarters

O SO in first quater, S10,000 gain in third quarter.

O S50,000 loss in first quarter, S60,000 gain in third quarter