The City of Upper Falls accounts for its inventory using the purchases method. During the year the City bought $400,000 of supplies, for which it owed $100,000 at year-end. The City will pay for the supplies from available expendable financial resources. The entry that should be recorded in the City s General Fund is a. Debit Expenditures $400,000; Credit Cash $300,000 and Accounts Payable $100,000. b. Debit Expenditures $300,000; Credit Cash $300,000. c. Debit Supplies Inventory $400,000; Credit Cash $300,000 and Accounts Payable $100,000. d. Debit Supplies Inventory $300,000; Credit Cash $300,000.
The City of Upper Falls accounts for its inventory using the purchases method. During the year the City bought $400,000 of supplies, for which it owed $100,000 at year-end. The City will pay for the supplies from available expendable financial resources. The entry that should be recorded in the City s General Fund is a. Debit Expenditures $400,000; Credit Cash $300,000 and Accounts Payable $100,000. b. Debit Expenditures $300,000; Credit Cash $300,000. c. Debit Supplies Inventory $400,000; Credit Cash $300,000 and Accounts Payable $100,000. d. Debit Supplies Inventory $300,000; Credit Cash $300,000.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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The City of Upper Falls accounts for its inventory using the purchases method. During the year the City bought $400,000 of supplies, for which it owed $100,000 at year-end. The City will pay for the supplies from available expendable financial resources. The entry that should be recorded in the City s General Fund is
a. Debit Expenditures $400,000; Credit Cash $300,000 and Accounts Payable $100,000.
b. Debit Expenditures $300,000; Credit Cash $300,000.
c. Debit Supplies Inventory $400,000; Credit Cash $300,000 and Accounts Payable $100,000.
d. Debit Supplies Inventory $300,000; Credit Cash $300,000.
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