Question A- Based on a physical inventory taken on December 31, an entity determined its inventory on a FIFO basis to be $70,000 with a replacement cost of $65,000. The entity estimated that after further processing costs of $8,000, the completed inventory could be sold for $75,000. The entity's normal profit margin is 30%. What amount should the entity report as inventory in its December 31 balance sheet under U. S. GAAP assuming FIFO is used?

$67,000 $70,000 $65,000 $44,500 Question B-

A company owns a piece of equipment with a net cost (book value) of $30,000 (cost of $50,000 net of accumulated depreciation of $20,000). There are indicators that this equipment is impaired. The expected net future undiscounted cash flows are $31,000. The expected net future discounted cash flows are $28,000. The fair value of the equipment is $25,000. What is the impairment loss for the company using US GAAP and IFRS?

$0 for US GAAP and $2,000 for IFRS $2,000 for US GAAP and $0 for IFRS $2,000 for US GAAP and $5,000 for IFRS $5,000 for US GAAP and $2,000 for IFRS $0 for US GAAP and $5,000 for IFRS