Accounting Inventory Shrinkage Example Problem by drtaccounting

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Accounting Inventory Shrinkage Example Problem
Accounting Inventory Shrinkage is defined as a loss of inventory computed by
comparing physical count of inventory with recorded amounts.

Reasons for Inventory Shrinkage
• Theft
• Obsolescence
• Spoilage
• Damage
• Customer Grazing
• Display Items
Journal Entry for Inventory Shrinkage

Debit COGS
Credit Merchandise Inventory

Additional Inventory Accounting Examples:
Perpetual Inventory System
Basic Equation for Inventory Accounts
Inventory Cost Flow Assumptions


Labels: accounting journal entry, inventory, inventory shrinkage

								
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