Differences in the ending physical count of inventory are added to the cost of goods sold.

Question

Quizplus · Accepted Answer

Differences in the ending physical count of inventory are added to the cost of goods sold because they represent the difference between the actual cost of goods sold and the cost of goods sold as recorded in the accounting records. This difference is typically due to errors in counting or recording inventory, and it is important to adjust the cost of goods sold to reflect the actual cost of the goods that were sold.

Differences in the Ending Physical Count of Inventory Are Added