Jones, Inc. is a supplier for the boating manufacturing industry based in Annapolis, Maryland. Jones is a publicly traded company with a calendar fiscal year. Jones uses the LIFO method for inventory measurement. In 2019, one of Joness competitors introduced a new product with technology that reduced some of the price levels in Jones inventory. As a result, Jones recognized a $100,000 write down in its inventory so inventory would be correctly stated at the lower of cost or market.

During the year ending December 31, 2020 the market value of the inventory has greatly improved due to changing market conditions. The company would like to reverse the write down from the prior year to reflect the current value of the inventory.

Accounting Issue: Can Jones reverse the prior year write down in inventory valuation in the next fiscal year?

Codification Reference: _____________________

Your interpretation of the guidance. i.e. can they reverse the inventory write down taken in the prior year? Answer : Yes or No ___________________

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