4. If the physical count of inventory revealed $158,000 of merchandise on hand and the inventory records reported $163,000, what would be the necessary adjusting entry to record inventory shrinkage? 5. where are selling and administrative expenses found on the multiple step income statement? A.after sales and before gross profit B. after net income amd before expenses c. after gross payment D.before gross profit 6. Expenses that are incurred directly in connection with the sale of merchandise are classified as A. other expenses B. administrative C. selling expenses D. general expenses