A journal entry for inventory write down is an accounting process that recognizes the reduced value of a company’s inventory. When the inventory assets become obsolete, damaged, or otherwise unsuitable for sale, the business must record the difference between the original cost of the assets and its current market value. This journal entry is used to reduce the inventory asset value on the balance sheet, ensuring the accuracy and integrity of financial statements. By writing down the value of unsellable inventory, businesses can stay honest and responsible in their accounting practices.