Inventory write-down to net realizable value Steps:

• Original cost of all inventory in draft: $50,000
• Cost of damaged items included at: $15,000
• Net realizable value of damaged items: $5,000 (salvage sale price)
• Required write-down: $15,000 -$5,000 = $10,000 (reduces total inventory to$40,000)

Why C is correct:

• Under accounting standards (e.g., IAS 2 or GAAP), inventory is stated at the lower of cost or net realizable value; the $10,000 difference is the write-down amount for damaged goods.

Why the others are wrong:

• A: $49,000 implies a$1,000 write-down, ignoring the full $10,000 impairment.
• B: $50,000 ignores the need to write down damaged items below cost.
• D: $15,000 uses original cost for damaged items, violating lower of cost or NRV rule.

Final answer: C