During the company's first year of operations,supplies costing $8,700 were purchased and recorded in the Supplies account.At the end of the period,supplies costing $4,500 were left.What adjusting entry must be made?

Question

Quizplus · Accepted Answer

Supplies used = Beginning balance + Supplies purchased − Supplies on hand
= $0 + $8,700 − $4,500 = $4,200 The adjusting entry includes a debit to Supplies Expense for $4,200 (for the amount used)and a credit to Supplies $4,200 (to decrease the Supplies account to the amount on hand at the end of the year).

During the Company's First Year of Operations,supplies Costing $8,700 Were