At the End of Its Accounting Year, Guild Corp

Multiple Choice

At the end of its accounting year, Guild Corp.'s physical inventory count indicated that 540,000 units of inventory, costing $1.50 each, were on hand.The company's perpetual inventory system reported a balance of $817,200.The year-end adjusting entry is

A) debit Inventory and credit Loss on Inventory Due to Count, $7,200.
B) debit Loss on Inventory Due to Count and credit Inventory, $7,200.
C) debit Inventory and credit Loss on Inventory Due to Count, $277,200.
D) debit Loss on Inventory Due to Count and credit Inventory, $277,200.