On January 1, 20B, the ledger of Global Corporation correctly showed supplies inventory of $500. During 20B, supplies purchases amounted to $700. A count (inventory) of supplies on hand at December 31, 20B, showed $400. The 20B income statement should report supplies expense amounting to which of the following?

Question

Quizplus · Accepted Answer

Supplies expense can be calculated as:
Supplies expense = Beginning supplies inventory + Supplies purchases - Ending supplies inventory
Supplies expense = $500 + $700 - $400 = $800. Therefore, the 20B income statement should report supplies expense of $800. Choice D is the correct answer.

On January 1, 20B, the Ledger of Global Corporation Correctly