To determine the amount at which inventory should be reported on the December 31, Year 1 balance sheet

To determine the amount at which inventory should be reported on the December 31, Year 1 balance sheet, Monroe Company compiles the following information for its inventory of product z on hand at the date:Historical cost……………………………………………………………$20,000Replacement cost……………………………………………………….$14,000Estimated selling price…………………………………………………$17,000Estimated costs to complete and sell……………………………..2,000Normal profit margin as a percentage of selling price………20%The entire inventory of product Z that was on hand at Dec. 31, Year 1 was completed in Year 2 at cost of $1,800 and sold at a price of $17,150.a. Determine the impact that Product Z has on income in Year 1 and Year 2 under IFRS and US GAAPb. Summarize the difference in income, total assets , and total stockholders’ equity using the two different sets of accounting rules over the two year period.