Comments on: How would we record stolen goods on a financial position worksheet? http://www.mathstudenthelp.info/worksheet/how-would-we-record-stolen-goods-on-a-financial-position-worksheet Let us help you add it up! Sun, 12 Feb 2012 09:28:02 +0000 http://wordpress.org/?v=2.7 hourly 1 By: capwest5a http://www.mathstudenthelp.info/worksheet/how-would-we-record-stolen-goods-on-a-financial-position-worksheet/comment-page-1#comment-7076 capwest5a Wed, 10 Feb 2010 16:15:59 +0000 http://www.mathstudenthelp.info/worksheet/how-would-we-record-stolen-goods-on-a-financial-position-worksheet#comment-7076 Stolen goods just become part of the Cost of Goods Sold account (after all, it's pretty much the same as if a physical inventory count reveals that inventory is $1,000 less than the amount shown on the books). The entry is: Debit "Cost of Goods Sold' $1,000 [expense account] Credit 'Merchandise Inventory' $1,000 This entry serves to reduce the amount carried on the books regarding inventory, and also serves to reduce net income because COGS is an expense account.<br><b>References : </b><br> Stolen goods just become part of the Cost of Goods Sold account (after all, it’s pretty much the same as if a physical inventory count reveals that inventory is $1,000 less than the amount shown on the books). The entry is:

Debit "Cost of Goods Sold’ $1,000 [expense account]
Credit ‘Merchandise Inventory’ $1,000

This entry serves to reduce the amount carried on the books regarding inventory, and also serves to reduce net income because COGS is an expense account.
References :

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