Accounting for inventory Transactions with Purchase Commitments In Year 1. Moss Company signed a contract with a suppiier to purchase 66,000 subassemblies at 530 each duripg Year 2 When the contract was signed, the contract price was less than the net realiable value of the inventory. The company uses the FFO method to account for irventory Assume Moss Company uses a periodic invertory system. fequired a. The cost of subassemblies has declined, and the estimated net realizable value is now $1,870,000 on December 31 of Yeat 1, Prepare any year.end entry required for this cost decline b. The subassembles are received in Year 2 when the net realizable value is estimated at 51,870,000. The contract was paid in full in casht prepare the required purchase entry in Year 2