A company purchased office supplies costing $5,000 and debited Supplies for the full amount.At the end of the accounting period, a physical count of office supplies revealed $900 still on hand.The appropriate adjusting journal entry to be made at the end of the period would be:
A)debit Supplies Expense, $5,900; credit Supplies, $5,900.
B)debit Supplies, $900; credit Supplies Expense, $900.
C)debit Supplies Expense, $4,100; credit Supplies, $4,100.
D)debit Supplies, $4,100; credit Supplies Expense, $4,100.

Question

Quizplus · Accepted Answer

The company initially recorded $5,000 as Supplies. At the end of the period, only $900 worth of supplies remain, meaning $4,100 worth of supplies were used. Therefore, Supplies Expense should be debited for $4,100, and Supplies should be credited for $4,100 to reflect the used supplies.

A Company Purchased Office Supplies Costing $5,000 and Debited Supplies