Sandals Company is preparing the annual financial statements dated December 31. Ending inventory is presently recorded at its total cost of $7,500. Information about its inventory items follows:

Product Line	Quantity on Hand			Unit Cost When Acquired (FIFO)			Value at Year-End
Air Flow		95		$	25		$	31
Blister Buster		15			70			65
Coolonite		15			45			43
Dudesly		85			40			48

1) . Compute the LCM/NRV write-down per unit and in total for each item in the table. Also compute the total overall write-down for all items.

Product Line	Quantity on Hand	Write-down per item	Total Write-down
Air Flow	95
Blister Buster	15
Coolonite	15
Dudesly	85
Total

2) How will the write-down of inventory to lower of cost or market/net realizable value affect the companys expenses reported for the year ended December 31?

Cost of goods sold will be _____

by_____

• Required 1
• Required 2
• Required 3

3) Compute the amount that should be reported for the inventory on December 31, after the LCM/NRV rule has been applied to each item.

Written-down inventory______