The Adjusting Entry to Reflect Inventory Shrinkage Is a Debit

question 207

True/False

The adjusting entry to reflect inventory shrinkage is a debit to Income Summary and a credit to Inventory Shrinkage Expense.

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Definitions:

Time Certain

A specific, agreed-upon moment or period in which something is to occur or be completed, often used in contracts and scheduling.

Assumed Name

An assumed name, also known as a trade name or "doing business as" (DBA), is a name a business uses that is different from its legal, registered name.

Device

A piece of equipment designed for a particular purpose, often electronic in nature.

Demand Instrument

A financial document that requires the payment of money immediately or on demand.