General
Inventory Write-Down to Net Realizable Value
Adjusting inventory value when the market price drops below the cost (LCM/NRV rule).
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Cost of Goods Sold (or Loss) | Expense (+) | 2,000.00 | - |
| Inventory | Asset (-) | - | 2,000.00 |
💡 Accountant's Note
This follows the Conservatism principle. You must report inventory at the lower of cost or its net realizable value.
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