Which of the Following Is an Appropriate Journal Entry to Recognise

question 28

Multiple Choice

Which of the following is an appropriate journal entry to recognise inventory items that have been lost?

• A)
• DR Inventory(asset)
• CR Provision for inventory losses (liability);
• B)
• DR Inventory losses (expense)
• CR Inventory (asset);
• C)
• DR Cost of Goods Sold (expense) CR Inventory (asset);
• D)
• DR Provision for Inventory losses (liability) CR Inventory (asset).

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Definitions:

Status Quo Pricing

A pricing strategy where prices are set similar to competitors or kept the same over time to maintain the existing market position.

Pricing Structure

The strategic arrangement of prices within a company's portfolio of products or services, aimed at achieving financial goals and market competitiveness.

Fares

The prices paid for journeys on public transportation like buses, trains, and airplanes.

Break-Even Point

The point at which the number of units sold generates just enough revenue to equal the total costs; at this point, profits are zero.