On January 1,Ogden Inc.had $2,000 of supplies on hand.During January,Ogden purchased $4,000 worth of new supplies.At the end of the month,a count revealed $1,000 worth of supplies remaining on the shelves.The adjustment entry needed will include a debit to Supplies Expense of $5,000.The supplies were initially recorded as an asset.

Question

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The supplies used during January are calculated as the beginning balance ($2,000) plus purchases ($4,000) minus the ending balance ($1,000), which equals $5,000. This amount should be debited to Supplies Expense to reflect the cost of supplies used.