A company normally sells it products for $20 per unit, which includes a profit margin of 25%.

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Question:

A company normally sells it products for $20 per unit, which includes a profit margin of 25%. However, the selling price has fallen to $15 per unit. This company's current inventory consists 200 units purchased at $16 per unit. Replacement cost has now fallen to $13 per unit. Calculate the value of inventory at the lower of cost or market.

a. $2,550.

b. $2,600.

c. $2,700.

d. $3,000.

e. $3,200.