Question

In the adjusting entry to record using up supplies, the credit is to what account and for what amount? 

A) credit supplies expense for the amount of supplies on hand at the end of the period 

B) credit the supplies account for the amount of supplies used up during the period 

C) credit the supplies account for the amount of supplies on hand at the end of the period 

D) credit supplies expense for the amount of supplies used up during the period 

Answer 1

In the adjusting entry to record using up supplies, the credit is to what account and for what amount?

Answer: B) credit the supplies account for the amount of supplies used up during the period.

• Supplies are stock of consumable items such as printer cartridges, cleaning items, stationery items, etc.
• When supplies are purchased, they are debited to the supplies account.
• Once consumed they are written off as supplies expense.
• Supplies at the beginning of the year + Supplies purchased during the year = Supplies available during the year
• Supplies available during the year - Supplies at the end of the year = Supplies used during the year.
• Supplies used during the year is the supplies expense which appears in the income statement.

• Supplies account is an asset account. It is a current asset in the balance sheet.
• Supplies expense is an expense account that will appear in the income statement.
• The journal entries:
• 
• Supplies (asset) ledger account:
•