Coco Loco, Inc.'s Inventory balance at year end was $1,000, which consists of 100 units at $10 each. The market value at year end is $9 per unit. Select which one of the following statements is true.

An adjusting entry with a debit to Inventory and a credit to Cost of Goods Sold for $100 must be recorded.

No adjusting entry is required.

An adjusting entry with a debit to Cost of Goods Sold and a credit to Inventory for $100 must be recorded.

An adjusting entry with a debit to Cost of Goods Sold and a credit to Inventory for $900 must be recorded.

An adjusting entry with a debit to Inventory and a credit to Cost of Goods Sold for $900 must be recorded