Madison Company's perpetual inventory records indicate that $875,300 of merchandise should be on hand on October...

 

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Madison Company's perpetual inventory records indicate that $875,300 of merchandise should be on hand on October 31. The physical inventory indicates that $781,900 is actually on hand. Required: Journalize the adjusting entry for the inventory shrinkage for Madison Company for the year ended October 31. Refer to the Chart of Accounts for exact wording of account titles. Chart of Accounts CHART OF ACCOUNTS Madison Company General Ledger ASSETS REVENUE 110 Cash 410 Sales 120 Accounts Receivable 125 Notes Receivable EXPENSES 130 Inventory 510 Cost of Goods Sold 131 Estimated Returns Inventory 521 Delivery Expense 140 Supplies 522 Advertising Expense 142 Prepaid Insurance 523 Depreciation Expense 180 Land 526 Salaries Expense 190 Equipment 531 Rent Expense 191 Accumulated Depreciation 533 Insurance Expense 534 Supplies Expense LIABILITIES 536 Credit Card Expense 210 Accounts Payable 560 Miscellaneous Expense 216 Salaries Payable 710 Interest Expense 221 Sales Tax Payable 222 Customers Refunds Payable 231 Unearned Rent 241 Notes Payable EQUITY 310 Common Stock 311 Retained Earnings General Journal Journalize the adjusting entry for the inventory shrinkage for Madison Company for the year ended October 31. Refer to the Chart of Accounts for exact wording of account titles. PAGE 1 JOURNAL DATE DESCRIPTION POST. REF. DEBIT CREDIT 1 Oct. 31 2 Madison Company's perpetual inventory records indicate that $875,300 of merchandise should be on hand on October 31. The physical inventory indicates that $781,900 is actually on hand. Required: Journalize the adjusting entry for the inventory shrinkage for Madison Company for the year ended October 31. Refer to the Chart of Accounts for exact wording of account titles. Chart of Accounts CHART OF ACCOUNTS Madison Company General Ledger ASSETS REVENUE 110 Cash 410 Sales 120 Accounts Receivable 125 Notes Receivable EXPENSES 130 Inventory 510 Cost of Goods Sold 131 Estimated Returns Inventory 521 Delivery Expense 140 Supplies 522 Advertising Expense 142 Prepaid Insurance 523 Depreciation Expense 180 Land 526 Salaries Expense 190 Equipment 531 Rent Expense 191 Accumulated Depreciation 533 Insurance Expense 534 Supplies Expense LIABILITIES 536 Credit Card Expense 210 Accounts Payable 560 Miscellaneous Expense 216 Salaries Payable 710 Interest Expense 221 Sales Tax Payable 222 Customers Refunds Payable 231 Unearned Rent 241 Notes Payable EQUITY 310 Common Stock 311 Retained Earnings General Journal Journalize the adjusting entry for the inventory shrinkage for Madison Company for the year ended October 31. Refer to the Chart of Accounts for exact wording of account titles. PAGE 1 JOURNAL DATE DESCRIPTION POST. REF. DEBIT CREDIT 1 Oct. 31 2

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Unadjusted inventory balance 875300 Balance on Physical count 781900 Shrinkage ... View the full answer