On December 31 of the current year,Holmgren Company's bookkeeper made an entry debiting Supplies Expense and crediting Supplies on Hand for $12,600.The Supplies on Hand account had a $15,300 debit balance on January 1.The December 31 balance sheet showed Supplies on Hand of $11,400.Only one purchase of supplies was made during the month,on account.The entry for that purchase was

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The entry made on December 31 debited Supplies Expense for $12,600 and credited Supplies on Hand, indicating that $12,600 worth of supplies were used during the month. The Supplies on Hand balance on January 1 was $15,300, and the balance sheet on December 31 showed a balance of $11,400, indicating that the company used $3,900 worth of supplies during the month ($15,300 - $11,400 = $3,900).

Since there was only one purchase of supplies during the month, and the total amount of supplies used was $3,900, the amount of the purchase must have been $8,700 ($8,700 + $3,900 = $12,600). The purchase was made on account, so the entry would be to debit Supplies on Hand (increasing it to account for the new purchase) and credit Accounts Payable (since the company owed for the purchase). Thus, the answer is C - debit Supplies on Hand, $8,700 and credit Accounts Payable, $8,700.

On December 31 of the Current Year,Holmgren Company's Bookkeeper Made