At the beginning of December,Global Corporation had $2,000 in supplies on hand.During the month,supplies purchased amounted to $3,000,but by the end of the month the supplies balance was only $800.What is the appropriate month-end adjusting entry?

Question

Quizplus · Accepted Answer

The supplies purchased during the month amounted to $3,000, so the total supplies available during the month were $5,000 ($2,000 beginning balance + $3,000 purchases). However, by the end of the month, only $800 worth of supplies were left. This means that $4,200 worth of supplies were used or consumed during the month. Therefore, the appropriate adjusting entry would be to debit Supplies Expense for $4,200 and credit Supplies for $4,200. Option C is the only one that matches this description.

At the Beginning of December,Global Corporation Had $2,000 in Supplies