Shaftebury Ltd.began operations and purchased $15,900 of supplies.By year end,$8,800 of supplies were still on hand.The adjusting entry at year end would include a:

Question

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The adjusting entry should recognize the supplies used during the year. The supplies used is the difference between the initial purchase and the supplies on hand, which is $15,900 - $8,800 = $7,100. Therefore, a debit to Supplies Expense for $7,100 is needed to reflect the expense incurred.