On December 31, Treats Catering Inc.'s trial balance shows a $1,000 balance in the Supplies account. However, a physical count of the supplies determined that only $350 of supplies actually remain in the supply cabinet. Select the adjusting entry made on December 31, to record the amount of supplies that had been used during the year.

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Business

Lazarus

21 September, 03:57

On December 31, Treats Catering Inc.'s trial balance shows a $1,000 balance in the Supplies account. However, a physical count of the supplies determined that only $350 of supplies actually remain in the supply cabinet. Select the adjusting entry made on December 31, to record the amount of supplies that had been used during the year.

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Clarence Holmes · Answer 1

Debit Supplies expense account $650

Credit supplies account $650

Explanation:

When supplies are purchased but yet to be used, the entries required are

Debit supplies account

Credit cash/accounts payable

When supplies are used up, the entries required are

Debit Supplies expense account

Credit supplies account

As such where On December 31, Treats Catering Inc.'s trial balance shows a $1,000 balance in the Supplies account. However, a physical count of the supplies determined that only $350 of supplies actually remain in the supply cabinet, the supplies used up

= $1,000 - $350

= $650

adjusting entries required

Debit Supplies expense account $650

Credit supplies account $650

Being entries to recognized supplies used up.