Multiple Choice Question

Identify the statement below that is the correct definition of inventory shrinkage.

Shrinkage is the discount received against the purchase price of merchandise.

Shrinkage is the term used to refer to the loss of inventory due to theft, breakage or deterioration.

Shrinkage is the term used to describe the diminished floor space that an inventory item has in a store.

Multiple Choice Question

Sales is a$($n$)$

account.

expense

asset

liability

revenue