Indicate Whether Each of the Following Statements Is True or False

question 28

Essay

Indicate whether each of the following statements is true or false. (Assume a perpetual inventory system.)
_____ a) In a perpetual inventory system, an employee theft is discovered immediately.
_____ b) No adjusting entry is required for inventory losses under a perpetual inventory system.
_____ c) Inventory shrinkage is calculated as the difference between the beginning and ending balances in the merchandise inventory account.
_____ d) In a perpetual inventory system, adjustments for lost, damaged or stolen merchandise are recorded as expenses.
_____ e) The adjusting entry to record inventory losses due to employee theft or shoplifting has a negative effect on the statement of cash flows.

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Definitions:

Fraud

The intentional deception or misrepresentation that an individual or entity makes to gain a benefit to which they are not entitled.

Physicians' Desk Reference

The Physicians' Desk Reference is a comprehensive drug and prescribing information resource for healthcare professionals.

Medical Terminology

The language used by healthcare professionals to accurately describe the body, its processes, conditions affecting it, procedures performed on it, and pharmacology.

Anatomy and Physiology

The scientific study of the structure of living organisms and their parts, alongside the physical and chemical functions of these structures and systems.