At year-end, the perpetual inventory records of Litwin Company showed merchandise inventory of $98,000. The company determined, however, that its actual inventory on hand was $95,700.

Required:
Record the necessary adjusting entry.

Adjusting Entry

Dr. Cost of Goods Sold $2,300

Cr. Inventory                  $2,300

Explanation:

At year end the inventory value is adjusted after inventory count. the difference is charged to the cost of goods sold and Inventory is adjusted accordingly.

Difference = $98,000 - $95,700 = $2,300

Inventory will be reduced by $2,300 with a credit entry in the inventory account and this amount will be charged as an expense in the cost of goods sold account.

explanation:

a gas is not used in hydraulic machines as the fluid because gas is easily compressible and so if a gas is used, the energy would mostly go into compressing a gas. therefore a liquid is used in hydraulic machines as the fluid.

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