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College Accounting (Book Only): A ...

13th Edition
Scott + 1 other
ISBN: 9781337280570

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BuyFindarrow_forward

College Accounting (Book Only): A ...

13th Edition
Scott + 1 other
ISBN: 9781337280570
Textbook Problem

Rainy Day Services had $430 of supplies reported on its unadjusted trial balance as of March 31. During the month of March, Rainy Day Services used $175 worth of supplies. What is the entry to adjust supplies?

  1. a. Supplies Expense    175

Cash    175

  1. b. Supplies    430

Supplies Expense    430

  1. c. Supplies Expense    255

Supplies    255

  1. d. Supplies Expense    175

Supplies    175

To determine

Find the correct option, the option that indicates the correct entry to adjust supplies.

Explanation

Adjusting entries: Adjusting entries are those entries which are recorded at the end of the year, to update the income statement accounts (revenue and expenses) and balance sheet accounts (assets, liabilities, and owners’ or stockholders’ equity) to maintain the records according to accrual basis principle and matching concept.

Prepare adjusting entry for supplies.

DateAccount Titles and ExplanationPost Ref.Debit ($)Credit ($)
March 31Supplies Expen...

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