When evaluating its year end inventory at the end of fiscal 2017, a company determines that its inventory is valued $250,000 to $350,000 above NRV What is the impact on the balance sheet and income statement in 2017 and 2018 if the inventory is written down by $250,000 is 2017 What is the impact if...

If inventory is written down by 250000 or 350000 the balance sheet inventory account will be reduced ...

When evaluating its year-end inventory at the end of fiscal 2017, a company determines that its inventory

Question:

When evaluating its year-end inventory at the end of fiscal 2017, a company determines that its inventory is valued $250,000 to $350,000 above NRV. What is the impact on the and income statement in 2017 and 2018 if the inventory is written down by
$250,000 is 2017? What is the impact if the inventory is written down by $350,000 in 2017? What accounting concept might lead management to use the higher amount for the write down? Explain. Assume the written-down inventory is sold in 2018.

Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...