Woods company uses the perpetual inventory system. At year end the general ledger indicated that this company had a balance of $ 50,000 in the Inventory account. Actual inventory on hand per a physical count was $ 50,500. What action does the company now need to take?

A. No action is needed; the difference between the ledger and actual is less than 5%.

B. The company should debit the Purchases account and credit Cost of Goods Sold.

C. The company needs to debit Cost of Goods Sold and credit Inventory, $ 500.

D. The company needs to debit Inventory and credit Cost of Goods Sold for $ 500.

Answer rating: 100% (QA)

Option D is correct The company needs to ... View the full answer