Forester Company has five products in its inventory. Information about the December 31, 2021, inventory follows.

Product		Quantity		Unit Cost				Unit Replacement Cost				Unit Selling Price
A		800		$	27			$	29			$	33
B		800			32				28				35
C		600			20				19				25
D		800			24				21				23
E		500			31				29				30

The cost to sell for each product consists of a 15 percent sales commission. The normal profit for each product is 35 percent of the selling price. Required: 1. Determine the carrying value of inventory at December 31, 2021, assuming the lower of cost or market (LCM) rule is applied to individual products. 2. Determine the carrying value of inventory at December 31, 2021, assuming the LCM rule is applied to the entire inventory. 3. Assuming inventory write-downs are common for Forester, record any necessary year-end adjusting entry based on the amount calculated in requirement 2.

Product (units)	RC	NRV	NRV-NP	Market	Cost	Inventory carrying value
A (800)
B (800)
C (600)
D (800)
E (500)
Total

3.

Journal entry worksheet

• Record any necessary year-end adjusting entry assuming that inventory write-downs are common for Forester Company.

Note: Enter debits before credits.

Transaction	General Journal	Debit	Credit
1