At the beginning of 2017, the City of Mauer reported an Unreserved Fund Balance of $890,000 and a supplies inventory balance of $280,000. During the year, Mauer purchased $360,000 in supplies and used $350,000 worth. The city will report a reserve for supplies inventory.
Required:
a. Prepare the journal entries needed to account for the supplies under the consumption method.
b. Prepare the necessary journal entries under the purchases method.
c. What would the December 31, 2017, balance in the Unreserved Fund Balance be under the consumption method, assuming that the only transactions of the fund are those involving the supplies?

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The Answer of At the beginning of 2017, the City of Mauer reported an Unreserved Fund Balance of $890,000 and a supplies inventory balance of $280,000. During the year, Mauer purchased $360,000 in supplies and used $350,000 worth. The city will report a reserve for supplies inventory.
Required:
a. Prepare the journal entries needed to account for the supplies under the consumption method.
b. Prepare the necessary journal entries under the purchases method.
c. What would the December 31, 2017, balance in the Unreserved Fund Balance be under the consumption method, assuming that the only transactions of the fund are those involving the supplies?

At the Beginning of 2017, the City of Mauer Reported