Gift Shops Unlimited's unadjusted Merchandise Inventory at December 31, 2019 was $7,600. The cost associated with the physical count of inventory on hand on December 31, 2019 was $7,350. In addition, Gift Shops Unlimited estimated approximately $800 of merchandise sold on account will be returned with a cost of $450. Assume a perpetual inventory system is used.
Requirements:
1. Journalize the adjustment for inventory shrinkage. Omit explanation.
2. Journalize the adjustment for estimated sales returns. Omit explanation.
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