Question

On December 31, 2019, Coolwear, Inc. had a balance in its supplies account of $48,400. During 2020, $86,000 was paid for new supplies. At the end of 2020, after adjusting entries were recorded, the balance in the supplies account was 42,000. Supplies expense for 2020 would be:_________

Answer 1

Answer:

$92,400

Explanation:

Supplies expense for 2020 would be calculated as;

= Ending balance in supplies account on December 31, 2019 + Payment for new supplies in 2020 - Balance in supplies account at the end of year 2020

Given that ;

Ending balance in supplies account = $48,400

Payment for new supplies = $86,000

Balance in supplies account at the end of year 2020 = $42,000

Therefore,

Supplies expense for 2020

= $48,400 + $86,000 - $42,000

= $92,400