Titan Offroad Equipment uses the FIFO inventory method and values its inventory using the lower of cost or net realizable value rule. Titan Offroad Equipment has the following account balances at December 31, 2014, prior to releasing the financial statements for the year:

The accountant for Titan Off road Equipment has determined that the replacement cost (current market value) of the ending inventory as of December 31, 2014, is $58,300.
Requirements
1. Which accounting principle or concept is most relevant to Titan Offroad Equipment€™s decision to utilize LCNRV?
2. What value would Titan Offroad Equipment report on the balance sheet at December 31, 2014, for inventory?
3. Prepare any adjusting journal entry required from the information given.

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Inventory Cost of Goods Sold Sales Revenue Beg Bal 54,300 End Bal 61,100 Ba 258,600 Bal 419,500