West Distribution Co. has determined its December 31, 2007 inventory on a FIFO basis at $360,000. Information pertaining to that inventory follows:
Estimated selling price $380,000
Estimated cost of disposal 15,000
Normal profit margin 45,000
Current replacement cost 330,000
West records losses that result from applying the lower of cost or market rule. At December 31, 2007, the loss that West should recognize is
a. $30,000.
b. $0.
c. $5,000.
d. $20,000.