Posted by Jill on Sunday, January 13, 2008 at 1:24pm.
Year end inventory at cost $55,902, at retail 84,700.
Questions:
A yearend physical inventory at retail prices yields a total inventory of $78,550. Prepare a calculation showing the company's loss from shrinkage at cost and at retail.

Accounting  Anonymous, Sunday, January 20, 2008 at 12:19pm
When the retail price is 84,700, the cost would 55,902, therefore how much of loss of inventory at cost when retail price is 78,500 = 51,843
Now the journal entry for shrinkage
would be
Losss of inventory (Shrinkage)4,059 Debit
Inventory account _credit 4,059
Calculation of inventoryloss at cost= 55,90251,843=4,059
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