Gross Company purchased $50,000 worth of office supplies on January 1.Gross expects to use 60 percent of the supplies in the first year and the remainder in the second year.After adjusting entries (and before closing entries), how much should Gross show in its Supplies Expense account?

Question

Quizplus · Accepted Answer

Since Gross expects to use 60% of the office supplies in the first year, the amount of supplies that should be expensed in the first year is $50,000 x 60% = $30,000. Therefore, after adjusting entries, Gross should show $30,000 in its Supplies Expense account.

Gross Company Purchased $50,000 Worth of Office Supplies on January