Perpetual inventory system

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Crystal Company's ledger on July 31, its fiscal year-end, includes the following selected accounts that have normal balances (Crystal uses the perpetual inventory system).


Merchandise inventory $ 42,000 Sales returns and allowances $ 7,600

Common stock 50,000 Cost of goods sold 115,000

Retained earnings 74,900 Depreciation expense 12,000

Sales 275,300 Salaries expense 45,000

Sales discounts 5,200 Miscellaneous expenses 7,000

A physical count of its July 31 year-end inventory discloses that the cost of the merchandise inventory still available is $40,600. Prepare journal entries to close the balances in temporary revenue and expense accounts. Remember to consider the entry for shrinkage that is made to solve

Reference no: EM13142087

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