A company had no office supplies available at the beginning of the year. During the year, the company purchased $250 worth of office supplies. On December 31, $75 worth of office supplies remained. How much should the company report as office supplies expense for the year?
A) $75.
B) $125.
C) $175.
D) $250.
E) $325.

Question

Quizplus · Accepted Answer

The office supplies expense for the year is the difference between the beginning inventory balance ($0) and the ending inventory balance ($75), plus the cost of purchases made during the year ($250). Therefore, the office supplies expense = ($75 - $0) + $250 = $175.

A Company Had No Office Supplies Available at the Beginning