Replacement cost

$14,000

Estimated selling price

$17,000

Estimated costs to complete and sell

$2,000

Normal profit margin as a percentage of selling price

20%

The entire inventory on hand at December 31, Year 1 was completed in Year 2 at a cost of $1,800 and sold at a price of $17,150.

Determine the impact on income in Year 1 and Year 2 under (1) IFRS and (2) US GAAP.