Question 1 Journalize the adjusting entry for the inventory shrinkage for Paragon Tire Co. for the year ended March 31, 20Y9. Refer to the Chart of Accounts for exact wording of account titles?
Paragon Tire Co.s perpetual inventory records indicate that $2,833,600 of merchandise should be on hand on March 31, 20Y9. The physical inventory indicates that $2,785,800 of merchandise is actually on hand. Journalize the adjusting entry for the inventory shrinkage for Paragon Tire Co. for the year ended March 31, 20Y9. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered.
CHART OF ACCOUNTS |
Paragon Tire Co. |
General Ledger |
| ASSETS | 110 | Cash | 120 | Accounts Receivable | 125 | Notes Receivable | 130 | Merchandise Inventory | 131 | Estimated Returns Inventory | 140 | Office Supplies | 141 | Store Supplies | 142 | Prepaid Insurance | 180 | Land | 192 | Store Equipment | 193 | Accumulated Depreciation-Store Equipment | 194 | Office Equipment | 195 | Accumulated Depreciation-Office Equipment | | LIABILITIES | 210 | Accounts Payable | 216 | Salaries Payable | 218 | Sales Tax Payable | 219 | Customer Refunds Payable | 221 | Notes Payable | | EQUITY | 310 | Owner, Capital | 311 | Owner, Drawing | | | REVENUE | 410 | Sales | 610 | Interest Revenue | | EXPENSES | 510 | Cost of Merchandise Sold | 521 | Delivery Expense | 522 | Advertising Expense | 524 | Depreciation Expense-Store Equipment | 525 | Depreciation Expense-Office Equipment | 526 | Salaries Expense | 531 | Rent Expense | 533 | Insurance Expense | 534 | Store Supplies Expense | 535 | Office Supplies Expense | 536 | Credit Card Expense | 539 | Miscellaneous Expense | 710 | Interest Expense | |