If a difference is found between the physical count and the amount in the perpetual inventory records, the records must be corrected by an appropriate adjusting entry.

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Quizplus · Accepted Answer

This is true because the perpetual inventory system relies on accurate and up-to-date records, and any discrepancies must be corrected to ensure that the inventory account reflects the actual amount of goods on hand. An adjusting entry can be used to record the difference between the physical count and the recorded amount and bring the inventory account into balance.

If a Difference Is Found Between the Physical Count and the Amount