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

Merchandise inventory	$	40,800		Sales returns and allowances	$	5,900
T. Nix, Capital		121,300		Cost of goods sold		106,800
T. Nix, Withdrawals		7,000		Depreciation expense		10,900
Sales		159,000		Salaries expense		35,500
Sales discounts		3,500		Miscellaneous expenses		5,000

A physical count of its July 31 year-end inventory discloses that the cost of the merchandise inventory still available is $39,350.

Journal entry worksheet 1 Record the adjustment for inventory shrinkage based on physical count. Note: Enter debits before credits. General Journal Debit Credit Date July 31 Record entry Clear entry View general journal