Included in ALANs inventory (valued using the LIFO method) are the following: $100,000 (cost) of sports equipment which manufacturers ceased producing in the middle of 2020. Although the wholesale value of the sports equipment now is only about $60,000, the retail value (if they could all be sold today, which they cant be) is approximately $110,000. The selling costs of these specific equipment are considered negligible, and a normal profit margin is approximately 25% of sales price. The retail market is thin and it will take some time to sell the equipment. Management intends to sell all of the equipment at retail and believes that the retail value of the equipment is likely to decrease at an average rate of 5 percent every quarter for the next year; thus, on average equipment with a retail value of $1,000 on 12/31/16 would have an average retail value of $950 and $900 during the first two quarters of 2021, respectively. Management believes that the equipment will be sold within the next year as follows--first quarter 40% of inventory, second quarter 35%, third quarter 20 %, and fourth quarter 5% at market values at the time of sale. These projections seem reasonable. It is currently February 15 and you note that sales are right on schedule and that retail prices have dropped a bit from year-end, as projected. Because of discontinuance of the above equipment, many suppliers of parts for the equipment have chosen to quit manufacturing the items with the result that shortages are occurring. As a result, ALANs $50,000 inventory of parts for these machines has increased in value and would now cost $65,000 to replace (its retail value is $110,000). Historically, the normal profit margin on sales of parts is 40% of sales price. Also, management has pointed out to you that equipment in inventory that dont sell could be used for parts. But management does not anticipate the need to do this. Historically, ALAN (and competitors) have in general separated Equipment from Parts when calculating the lower of cost or market for inventory. Does ALAN need to record an inventory write-down to reflect a lower of cost or market value? If so, how much?