Under a Perpetual Inventory System Inventory Shrinkage and Lost or Stolen

question 132

True/False

Under a perpetual inventory system inventory shrinkage and lost or stolen goods are more readily determined.

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Definitions:

Debit

An accounting entry that increases an asset or expense account, or decreases a liability or equity account.

Asset Accounts

Accounts on a company's balance sheet that represent the resources owned by the company which have economic value and can provide future benefits.

Debits

Entries on the left side of an accounting ledger, representing increases in assets or expenses and decreases in liabilities or equity.

Equipment

Tangible property used in the operations of a business, often contributing to the production of goods and services, and generally considered a long-term asset.