The Supplies account had a $720 debit balance at the end of the accounting period before adjustment for supplies used,and an inventory of $160 of unused supplies was on hand.Which of the following is the required adjusting entry?
A)Debit Supplies Expense $160 and credit Supplies $160.
B)Debit Supplies Expense $560 and credit Supplies $560.
C)Debit Supplies $160 and credit Supplies Expense $160.
D)Debit Supplies $560 and credit Supplies Expense $560.

Question

Quizplus · Accepted Answer

The correct adjusting entry is to debit Supplies Expense for the amount of supplies used ($720 - $160 = $560) and credit Supplies for the same amount, reflecting the decrease in supplies on hand.

The Supplies Account Had a $720 Debit Balance at the End