Prior to recording adjusting entries, the Office Supplies account had a $359 debit balance. A physical count of the supplies showed $105 of unused supplies available. The required adjusting entry is:
A) Debit Office Supplies $254 and credit Office Supplies Expense $254.
B) Debit Office Supplies $105 and credit Supplies Expense $254.
C) Debit Office Supplies $105 and credit Office Supplies Expense $105.
D) Debit Office Supplies Expense $254 and credit Office Supplies $254.
E) Debit Office Supplies Expense $105 and credit Office Supplies $105.

Question

Quizplus · Accepted Answer

The adjusting entry should reduce the Office Supplies account by the amount used, which is $359 - $105 = $254. Therefore, debit Office Supplies Expense $254 and credit Office Supplies $254.

Prior to Recording Adjusting Entries, the Office Supplies Account Had