Tatum Company has four products in its inventory. Information about the December 31, 2018, inventory is as follows:

product	total cost	total replacement cost	total net realizable value
101	$120,000	$100,000	$100,000
102	90,000	85,000	110,000
103	60,000	40,000	50,000
104	30,000	28,000	50,000

* The normal gross profit percentage is 25% of total cost

1. Determine the carrying value of inventory at December 31, 2018, assuming the lower of cost or market (LCM) rule is applied to individual products. 2. Assuming that inventory write-downs are common for Tatum Company, record any necessary year-end adjusting entry.