Data for the year ended December 31, 2023:

Item	Amount
Cost of Inventory	$1,200,000
Market Value of Inventory	$1,000,000
Sales	$5,000,000
Cost of Goods Sold	$3,200,000
Operating Expenses	$800,000

1. Calculate the amount of inventory to be reported on the balance sheet.
2. Determine the impact on net income due to the write-down of inventory.
3. Discuss how the inventory write-down affects Walmart’s gross margin.
4. Explain how the Conservatism Principle guides this write-down.
5. How should the company record the inventory write-down in its journal entries?