The Garrett Company uses the perpetual inventory system. Al $18,000 in the merchandise inventory account, a physical cou indicates the effect of the necessary adjusting entry? Balance

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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The Garrett Company uses the perpetual inventory system. Although its inventory records indicated a book balance of
$18,000 in the merchandise inventory account, a physical count showed only $16,250. Which of the following answers
indicates the effect of the necessary adjusting entry? Balance Sheet Income Statement Statement of Cash Flows Assets =
Liabilities + Stockholders' Equity Revenue - Expense = Net Income A. (1,750) n/a (1,750) n/a 1,750 (1,750) n/a B. n/a 1,750
(1,750) n/a 1,750 (1,750) n/a C. 16,250 n/a 16,250 16,250 n/a 16,250 16,250 IA D. (18,000) n/a (18,000) (18,000) n/a (18,000)
n/a
Transcribed Image Text:The Garrett Company uses the perpetual inventory system. Although its inventory records indicated a book balance of $18,000 in the merchandise inventory account, a physical count showed only $16,250. Which of the following answers indicates the effect of the necessary adjusting entry? Balance Sheet Income Statement Statement of Cash Flows Assets = Liabilities + Stockholders' Equity Revenue - Expense = Net Income A. (1,750) n/a (1,750) n/a 1,750 (1,750) n/a B. n/a 1,750 (1,750) n/a 1,750 (1,750) n/a C. 16,250 n/a 16,250 16,250 n/a 16,250 16,250 IA D. (18,000) n/a (18,000) (18,000) n/a (18,000) n/a
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