Question

On January 1, Year 2, the Supplies account of Sheldon Company had a balance of $1400. During the year, the company purchased $4100 of supplies on account and made partial payments totaling $2300 on those accounts. On December 31, Year 2, Sheldon determined that there were $2300 of supplies on hand. Which of the following would be reported on Sheldon's Year 2 financial statements? $2300 of supplies; $1800 of supplies expense $3200 of supplies; $900 of supplies expense $3200 of supplies; $4100 of supplies expense $2300 of supplies; $3200 of supplies expense

Answer 1

Answer:

$2300 of supplies; $3200 of supplies expense

Explanation:

The computation of the supplies expense is shown below

= Supplies balance + Purchased of supplies -  supplies on hand

= $1,400 + $4,100 - $2,300

= $3,200

Along with it, the journal entry is also recorded for better understanding

Supplies expense A/c Dr $3,200

                             To supplies A/c $3,200

(Being supplies account is adjusted)

The closing balance of supplies is $2,300 and supplies expense would be $3,200