The general ledger shows a balance of $66,900 in the Merchandise Inventory account at the end of the period.The physical inventory count shows inventory of $63,600.The adjusting entry includes a ________.
A)debit to Cost of Goods Sold and a credit to Merchandise Inventory for $3,300
B)debit to Cost of Goods Sold and a credit to Cash for $3,300
C)debit to Merchandise Inventory and a credit to Cost of Goods Sold for $3,300
D)debit to Merchandise Inventory and a credit to Cash for $3,300

Question

Quizplus · Accepted Answer

The adjusting entry should decrease the Merchandise Inventory account to match the physical count, so you debit Cost of Goods Sold and credit Merchandise Inventory for the difference of $3,300.

The General Ledger Shows a Balance of $66,900 in the Merchandise