Question

Office supplies at the beginning of 2021 total $980. On August 15, Wolverine purchases an additional $3,200 of office supplies, debiting the Supplies account. By the end of the year, $480 of office supplies remains. Record the adjusting entry for supplies at its year-end of December 31.

Answer 1

Answer:

Closing supplies is $3,700

Explanation:

Given:

Opening balance of supplies = $980

Additional supplies purchased = $3,200

Closing office supplies = $480

Expenditure incurred on supplies = Opening supplies + additional supplies purchased - closing supplies

                                                        = 980 + 3200 - 480

                                                        = $3700

Adjusting journal entry to record expenditure on supplies:

31st December        Supply expense A/c........................Dr     $3,700

                                                   Supplies A/c                                      $3,700

                                 (To record supplies expense incurred)