The Following Information Pertains to Inventory Held by a Company

The following information pertains to inventory held by a company on December 31, 2011. $$\begin{array} { l r } \text { Historical cost } & \$ 30,000 \\\text { Replacement cost } & \$ 20,000 \\\text { Net realizable value } & \$ 27,000 \\\text { Normal profit margin } & 20 \%\end{array}$$
-What is the amount of inventory loss shown on the income statement under U.S. GAAP?

A) $0.
B) $3,000.
C) $14,000.
D) $10,000.
E) $8,400. The amount of loss is the writedown of inventory from $30,000 to $21,600 = $8,400.