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3 November, 05:33

At the beginning of December, Global Corporation had $2,000 in supplies on hand. During the month supplies purchased amounted to $3,000, but by the end of the month the supplies balance was only $800. What is the appropriate month-end adjusting entry?

A. Debit Cash $4,200, credit Supplies $4,200.

B. Debit Supplies $4,200, credit Supplies Expense $4,200.

C. Debit Supplies Expense $4,200, credit Supplies $4,200.

D. Debit Cash $800, credit Supplies $800.

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  1. 3 November, 06:26
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    C. Debit Supplies Expense $4,200, credit Supplies $4,200.

    Explanation:

    The adjusting entry is shown below:

    Supplies expense A/c Dr $4,200

    To supplies A/c $4,200

    (Being supplies account is adjusted)

    The supplies expense is computed by

    = Supplies balance + purchase made - supplies on hand

    = $2,000 + $3,000 - $800

    = $5,000 - $800

    = $4,200

    We simply debited the supply expense account and credited the supplies account
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