Mariah company has inventory at the end of the year with a historical cost of $95,000. mariah company uses the perpetual inventory system. under the lcm rule, the current replacement cost is $75,600. under u. s. gaap, the journal entry to record the write-down to lcm will:

a. debit cost of goods sold for $19,400 and credit purchases for $19,400.

b. debit cost of goods sold for $19,400 and credit inventory for $19,400.

c. debit purchases for $19,400 and credit cost of goods sold for $19,400.

d. debit inventory for $19,400 and credit cost of goods sold for $19,400.

Question

Titus Nixon

4 December, 05:28

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Issac Elliott · Answer 1

Issac Elliott 4 December, 07:59

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The answer is (c) Debit purchases