During a company's first year, the asset account, Office Supplies, was debited for $3,900 for the purchases of supplies. At year-end, office supplies on hand were counted and determined to be $1,625. The proper adjusting entry crediting supplies and debiting supplies expense will

Question

Marcos Townsend

Business

31 May, 08:00

During a company's first year, the asset account, Office Supplies, was debited for $3,900 for the purchases of supplies. At year-end, office supplies on hand were counted and determined to be $1,625. The proper adjusting entry crediting supplies and debiting supplies expense will

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Answers (1)

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Braydon Blackburn · Answer 1

The adjusting entry will be shown below:

Explanation:

The adjusting journal which is to be recorded in the following case will be:

Office Supplies expense A/c ... Dr $2,275

Office Supplies A/c ... Cr $2,275

As the amount $3,900 is already debited and at the year end, the remaining amount of office will be posted to the account of the office supplies expense against the office supplies account.

Working Note:

Amount = Debited amount of office supplies - Offices supplies on hand

= $3,900 - $1,625

= $2,275