Barin Retail Outlets incorrectly recorded inventory in 2016. Rather than recording ending inventory as $960,000, Barin's accoun
ting manager entered $690,000, understating ending inventory by $270,000. Barin's controller discovered the error in 2018. Prepare the journal entry necessary to correct the inventory error, ignoring any income tax effects.
1 answer:
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Answer:
4.5
Explanation:
Inventory refers to the goods that a company has in its stock. Inventory includes raw materials and finished goods sold by the company.
Inventory turnover refers to the number of times a company sells and replaces its inventory during a given period.
Annual sales of a manufacturing company
Inventory
Inventory turnover ratio for the company = Sales/Inventory