3. Which statement below is true? When the net realizable value falls below its original cost, companies have a choice as to which valuation to report the inventory (original cost or net realizable value). The write-down of inventory from cost to net realizable value reduces total assets and increases total expenses, leading to lower net income and lower retained earnings. Net realizable value is defined as the estimated selling price plus any additional costs (i.e. completion, disposal, transportation) Inventory write downs to net realizable value occur as the inventory is sold. Revise your calculations based the new information provided below and then answer the questions that follow. Number of Inventory Units Unit Cost Unit NRV Item A 4,600 26 27 Item B 3,900 53 58 Item C 2,300 54 50 Item D 2,500 26 22 Required: 1. Based on the new information, prepare the journal entry required: 2. Change the Unit Cost for Item A to $30 and prepare the journal entry required: > Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Based on the new information, prepare the journal entry required: (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) Debit Credit 23,200 23,200 No 1 Transaction 1 General Journal Cost of Goods Sold Inventory < Required 1 Required 2 > Revise your calculations based the new information provided below and then answer the questions that follow. Number of Inventory Units Unit Cost Unit NRV Item A 4,600 26 27 Item B 3,900 53 58 Item C 2,300 54 50 Item D 2,500 26 22 Required: 1. Based on the new information, prepare the journal entry required: 2. Change the Unit Cost for Item A to $30 and prepare the journal entry required: Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Change the Unit Cost for Item A to $30 and prepare the journal entry required: (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) Debit Credit 18,600 18,600 No Transaction General Journal 1 1 Cost of Goods Sold Inventory < Required 1 Required 2 >