Prior to recording adjusting entries, the Office Supplies account had a $392 debit balance. A physical count of the supplies showed $96 of unused supplies available. The required adjusting entry is: Multiple Choice Debit Office Supplies $96 and credit Supplies Expense $296. Debit Office Supplies Expense $296 and credit Office Supplies $296. Debit Office Supplies $296 and credit Office Supplies Expense $296. Debit Office Supplies $96 and credit Office Supplies Expense $96 Debit Office Supplies Expense $96 and credit Office Supplies $96.
Prior to recording adjusting entries, the Office Supplies account had a $392 debit balance. A physical count of the supplies showed $96 of unused supplies available. The required adjusting entry is: Multiple Choice Debit Office Supplies $96 and credit Supplies Expense $296. Debit Office Supplies Expense $296 and credit Office Supplies $296. Debit Office Supplies $296 and credit Office Supplies Expense $296. Debit Office Supplies $96 and credit Office Supplies Expense $96 Debit Office Supplies Expense $96 and credit Office Supplies $96.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Transcribed Image Text:Prior to recording adjusting entries, the Office Supplies account had a $392
debit balance. A physical count of the supplies showed $96 of unused
supplies available. The required adjusting entry is:
Multiple Choice
Debit Office Supplies $96 and credit Supplies
Expense $296.
Debit Office Supplies Expense $296 and credit
Office Supplies $296.
Debit Office Supplies $296 and credit Office
Supplies Expense $296.
Debit Office Supplies $96 and credit Office Supplies
Expense $96
Debit Office Supplies Expense $96 and credit Office
Supplies $96.
Expert Solution
Step 1: Introduction
The office supplies are specifically debited from the office or store supplies account and credited to the cash account in the beginning in order to be recorded as assets. The expense for supplies utilized during the accounting period is recorded at the end of the period as an adjustment. Without this corrective entry, the income statement will overstate earnings and the balance sheet will reflect supplies that don't exist.
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