Blackstone, Inc., was in the final phase of completing a land development project it started earlier in the year. Blackstone, Inc., had acquired 50 acres of raw land for $400,000 and then spent an additional $1,700,000 in land development costs to create a new subdivision with 100 residential lots. With a total cost of $2,100,000 and 100 lots, each lot had a cost of $21,000; however, the lots were listed for sale at $48,000 per lot. Blackstone, Inc., was applying for a business loan and needed to provide current financial statements to the bank. Amy Clark, the company president, wanted to report the total current value of the lots, $4,800,000 (100 lots x $48,000 per lot), rather than the total cost currently listed on the balance sheet, $2,100,000. Dan Sullivan, the company accountant, told Amy the lots were inventory and should be reported on the balance sheet at the $2,100,000 rather than the fair market value.

Should the balance sheet for Blackstone, Inc., list the lots at the total cost of $2,100,000 or the total selling price of $4,800,000? Could Blackstone, Inc., provide one balance sheet using historical cost and another balance sheet using market value?