"Well, you have a set of inventory that hasn't moved in about 2 years. We think it might be time to write it down or," she went on quickly before Dave could say anything, "at least do a LCM test on it." Dave nodded. "Okay. If it hasn't moved in that long then you are probably right that it needs at least a test. I think," he tapped on his tablet for a minute, "I actually have those numbers right here. Anything else?" 5. Perform a lower of cost of market test on the inventory that Marla questioned and make any necessary adjusting entry using the direct method. Do you agree that ClearCrystal needs to make this adjustment? Why or why not? Figure 5 Sales Information Units on Hand Estimated Current Sales Price Typical Markup 2,800 $115 $48 $112 Cost Information Original Product Cost Estimated Current Product Cost Estimated Disposal Cost (cleaning and shipping) $118 $13.16