Manhattan Park adjusts its books each month and closes its books on December 31 each year. The trial balance at January 31, of the current year, before adjustments, follows:

-Refer to the above data. At January 31, the amount of supplies on hand is $2,300. What amount is shown on the January income statement for supplies expense?
A) $2,300.
B) $5,400.
C) $3,100.
D) $7,700.

Question

Manhattan Park adjusts its books each month and closes its books on December 31 each year. The trial balance at January 31, of the current year, before adjustments, follows:
 
-Refer to the above data. At January 31, the amount of supplies on hand is $2,300. What amount is shown on the January income statement for supplies expense?
A) $2,300. 
B) $5,400. 
C) $3,100. 
D) $7,700.

Quizplus · Accepted Answer

The supplies expense is calculated by subtracting the supplies on hand ($2,300) from the total supplies available at the beginning of the period. If the total supplies were $5,400, then the supplies expense would be $5,400 - $2,300 = $3,100.

Manhattan Park Adjusts Its Books Each Month and Closes Its