A county's general fund has $2,000,000 in supplies on hand at the start of 2021. During 2021, the county purchases $70,000,000 of supplies for cash, and uses $70,500,000 of supplies in operations.
Required
Prepare journal entries to record these events in 2021, including any year-end adjusting entries, if:
a. The general fund uses the consumption method to record supplies.
b. The general fund uses the purchases method to record supplies and does not report supplies inventories on its balance sheet.

Question

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The Answer of A county's general fund has $2,000,000 in supplies on hand at the start of 2021. During 2021, the county purchases $70,000,000 of supplies for cash, and uses $70,500,000 of supplies in operations.
Required
Prepare journal entries to record these events in 2021, including any year-end adjusting entries, if:
a. The general fund uses the consumption method to record supplies.
b. The general fund uses the purchases method to record supplies and does not report supplies inventories on its balance sheet.

A County's General Fund Has $2,000,000 in Supplies on Hand