On July 1, 2021, Martha Jones started Martha's Auto Repair Shop, Inc. On that same day, Martha purchased the following supplies for use in the repair shop: Unit of Measure Quantity Purchased Price per Unit Extended Total Cost Item Shop Towels Rolls 120 $4 $480 Degreasing Fluid Quarts 75 $9 $675 Gasket Sealer Tubes 40 $6 $240 Total $1,395 On July 1, Martha paid cash for the supplies and set the accounting policy that all supplies would initially be recorded in the Supplies asset account. At the end of July, Martha counted the supplies that were left and prepared the following listing: Quantity Remaining Unit of Item Measure Shop Towels Rolls 80 Degreasing Fluid Quarts 65 Gasket Sealer Tubes 32 At the end of August, Martha counted the supplies that were left and prepared the following listing: Unit of Quantity Remaining Item Measure Shop Towels Rolls 55 Degreasing Fluid Quarts 48 Gasket Sealer Tubes 22 The following is a partial list of the accounts in Martha's General Ledger. These are the only accounts you need for this problem. D Cash D Supplies D Supplies Expense
On July 1, 2021, Martha Jones started Martha's Auto Repair Shop, Inc. On that same day, Martha purchased the following supplies for use in the repair shop: Unit of Measure Quantity Purchased Price per Unit Extended Total Cost Item Shop Towels Rolls 120 $4 $480 Degreasing Fluid Quarts 75 $9 $675 Gasket Sealer Tubes 40 $6 $240 Total $1,395 On July 1, Martha paid cash for the supplies and set the accounting policy that all supplies would initially be recorded in the Supplies asset account. At the end of July, Martha counted the supplies that were left and prepared the following listing: Quantity Remaining Unit of Item Measure Shop Towels Rolls 80 Degreasing Fluid Quarts 65 Gasket Sealer Tubes 32 At the end of August, Martha counted the supplies that were left and prepared the following listing: Unit of Quantity Remaining Item Measure Shop Towels Rolls 55 Degreasing Fluid Quarts 48 Gasket Sealer Tubes 22 The following is a partial list of the accounts in Martha's General Ledger. These are the only accounts you need for this problem. D Cash D Supplies D Supplies Expense
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question

Transcribed Image Text:On July 1, 2021, Martha Jones started Martha's Auto Repair Shop, Inc. On that same day, Martha
purchased the following supplies for use in the repair shop:
Alt
Unit of
Measure
Quantity
Purchased
Price per
Unit
Extended
Total Cost
Item
Shop Towels
Rolls
120
$4
$480
Degreasing Fluid
Quarts
75
$9
$675
Gasket Sealer
Tubes
40
$6
$240
Total $1,395
On July 1, Martha paid cash for the supplies and set the accounting policy that all supplies would
initially be recorded in the Supplies asset account.
At the end of July, Martha counted the supplies that were left and prepared the following listing:
Quantity
Remaining
Unit of
Item
Measure
Shop Towels
Rolls
80
Degreasing Fluid
Quarts
65
Gasket Sealer
Tubes
32
At the end of August, Martha counted the supplies that were left and prepared the following listing:
Unit of
Measure
Quantity
Remaining
Item
Shop Towels
Rolls
55
Degreasing Fluid
Quarts
48
Gasket Sealer
Tubes
22
The following is a partial list of the accounts in Martha's General Ledger. These are the only
accounts you need for this problem.
> Cash
D Supplies
D Supplies Expense

Transcribed Image Text:Requirement 4 -- July 31 supplies adjusting entry
Debit
Credit
Date
Account Name
Requirement 5 -- August 31 supplies on-hand
Requirement 6 -- "T" Account Analysis for August 31 adjusting entry
"T" Account Analysis for Asset and Liability Accounts
Account Name =
Supplies (asset account)
Debit
Credit
(1) What is the current balance?
(3) What adjustment is required to
adjust from the current balance
to the should be balance?
(2) What should be the balance?
Requirement 7 -- August 31 supplies adjusting entry
Date
Account Name
Debit
Credit
Requirement 8 -- Total $ amount of supplies consumed during first 2 months of operation
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