The Supplies account has a trial balance of $3,136. A year-end inventory shows $1,734 worth of supplies left at the end of the year. The correct adjusting entry is:

Question

Quizplus · Accepted Answer

The Supplies account has a balance of $3,136 and there is $1,734 worth of supplies left at the end of the year. Therefore, the supplies that were used up during the year must be calculated by subtracting the ending inventory from the beginning balance: $3,136 - $1,734 = $1,402. This amount represents the Supplies Expense that should be recognized in the current year. The adjusting entry to record this expense is to debit Supplies Expense for $1,402 and credit Supplies for $1,402. Therefore, the correct answer is D.

The Supplies Account Has a Trial Balance of $3,136