West Distribution Co. has determined its December 31, 2007 inventory on a FIFO basis at $360,000. Information pertaining to that inventory follows:

Estimated selling price $380,000

Estimated cost of disposal 15,000

Normal profit margin 45,000

Current replacement cost 330,000

West records losses that result from applying the lower of cost or market rule. At December 31, 2007, the loss that West should recognize is

a. $30,000.

b. $0.

c. $5,000.

d. $20,000.