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What is the balance in the Inventory account

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Question - Tasty's Chocolate Store paid $6,000 for Easter Egg inventory on March 15th. By April 30th (2 weeks after Easter), the seasonal inventory can only be sold to customers for $4,000, and the decline in value appears permanent. In order to sell the inventory quickly, an on line advertisement must be taken out for $500 otherwise it is unlikely they will sell the Easter Eggs at all.

(a) Prepare the required Journal Entry for the above situation?

(b) What is the balance in the Inventory account after your Journal Entry?

(c) Explain why Accounting Principles require you to make this Journal Entry?

Reference no: EM132611584

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