Zenith Company's Merchandise Inventory account at year-end has a balance of $91,820,but a physical count reveals that only $90,450 of inventory exists.The adjusting entry to record this $1,370 of inventory shrinkage is:
(1) Cause: Demand forecast errors (cumulative uncertainty in the supply chain); Remedy: Share demand information throughout the supply chain. (2) Cause: Order batching (large, infrequent orders leading suppliers to order even larger amounts); Remedy: Channel coordination-determine lot sizes as though the full supply chain was one company. (3) Cause: Price fluctuations (buying in advance of demand to take advantage of low prices, discounts, or sales); Remedy: Price stabilization (everyday low prices). (4) Cause: Shortage gaming (hoarding supplies for fear of a supply shortage); Remedy: Allocate orders based on past demand.
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Blu-ray producers cannot jointly lobby Congress to change the copyright laws without being held liable for attempting to restrain trade.