Question

A company like Golf USA that sells golf-related merchandise typically will have inventory items such as golf clothing and golf equipment. As technology advances the design and performance of the next generation of drivers, the older models become less marketable and therefore decline in value. Suppose that in 2018, Ping (a manufacturer of golf clubs) introduces the MegaDriver II, the new and improved version or the MegaDriver. Below are amounts related to Golf USA's inventory at the end of 2018.

Inventory	Quantity	Cost	NRV
	27	$52	$74
	7	350	210
	22	310	430

Do not copy from chegg.

Record any necessary adjustment to inventory.

Answer 1

Inventory	Quantity (a)	Cost (b)	NRV ( c)	Total Cost (a x b)	Total Market( a x c)	Total value as per Lower of cost or Market
Golf clothing	27	52	74	1,404	1998	1,404
Gold equipment	7	350	210	2,450	1470	1,470
Mega Driver II	22	310	430	6,820	9460	6,820
Total	56			10,674	12,928	9,694

Inventory write down = Total cost of inventory - Total value of inventory as per lower of cost or NRV

= 10,674-9,694

= $980

General Journal	Debit	Credit
Cost of goods sold	$980
Inventory		$980
( To record inventory write down)