A firm uses the perpetual inventory system. The inventory account balance is $50 000. An actual count of inventory reveals that actual inventory is $43 000. Which of the following would be included in the required adjusting entry?
A)A $7 000 credit to Cost of sales would be required.
B)A $50 000 debit to Cost of sales would be required.
C)A $43 000 credit to Inventory would be required.
D)A $7 000 credit to Inventory would be required.

Question

Quizplus · Accepted Answer

The difference between the inventory account balance and the actual count is $7,000. To adjust the inventory account to reflect the actual count, a $7,000 credit to Inventory is required.

A Firm Uses the Perpetual Inventory System