Use this information to answer the following question. The trial balance for Nowwick Company appears as follows:

-If on December 31,20x5,supplies on hand were $120,the adjusting entry would contain a

Question

Use this information to answer the following question. The trial balance for Nowwick Company appears as follows:
 
-If on December 31,20x5,supplies on hand were $120,the adjusting entry would contain a

Quizplus · Accepted Answer

Since supplies on hand were worth $120, the adjusting entry should decrease the Supplies account by $120 and increase Supplies Expense by the same amount. Therefore, the entry should be a debit to Supplies Expense for $120 and a credit to Supplies for $120. However, according to the options given, the only choice that reflects this is option C, which has a debit to Supplies Expense for $180 (probably to account for the supplies used during the period) and a credit to Supplies for $120 (to adjust the balance to $120 on hand at the end of the period).

Use This Information to Answer the Following Question