Prior to recording adjusting entries, the Office Supplies account had a $1,750 debit balance. A physical count of the supplies at the end of the period showed $925 of unused supplies on hand. The required adjusting entry is:

Question

Quizplus · Accepted Answer

The adjusting entry required is to debit Office Supplies Expense (to reduce the asset) and credit Office Supplies (to record the actual amount of supplies on hand). The difference between the beginning balance of $1,750 and the actual amount on hand of $925 is $825.

Therefore the adjusting entry is:
Office Supplies Expense    825
       Office Supplies           825

Choice B represents this entry.

Prior to Recording Adjusting Entries, the Office Supplies Account Had