Harvey Company carries three inventory items. The following information pertains to the ending inventory:

Required
a. Determine the ending inventory that will be reported on the balance sheet, assuming that Harvey applies the lower-of-cost-or-market rule to individual inventory items.
b. Prepare the necessary adjustment, assuming the decline in value is immaterial.

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Unit Cost Unit Market Value Item Quantity 400 $20 25 $18 24 B 500 10 12 300