Identify the account to be debited under the perpetual inventory system if the amount shown by the physical count of inventory is less than the computer record.
A) Merchandise Inventory
B) Cost of Goods Sold
C) Purchase Returns
D) Miscellaneous Expense

Question

Quizplus · Accepted Answer

If the physical count of inventory is less than the recorded amount, it means that some inventory has been sold but has not been recorded in the financial statements yet. Therefore, the account to be debited would be Cost of Goods Sold, which represents the cost of the inventory that has been sold during the period.

Identify the Account to Be Debited Under the Perpetual Inventory