PE 6-6A Inventory shrinkage

House of Clean Company’s perpetual inventory records indicate that $375,000 of merchandise
should be on hand on June 30, 2012. The physical inventory indicates that $366,500
of merchandise is actually on hand. Journalize the adjusting entry for the inventory
shrinkage for House of Clean Company for the year ended June 30, 2012. Assume that
the inventory shrinkage is a normal amount.

Answer:
June 30 Cost of Merchandise Sold........................................ 8,500
                                Merchandise Inventory ....................................... 8,500
                                   Inventory shrinkage ($375,000 – $366,500).