Question

At the beginning of the year, office supplies of $1,200 were on hand. During the year, Amble Air Conditioning Service paid $3,500 for more office supplies. At the end of the year, Amble has $900 of office supplies on hand. Read the requirements Requirement 1. Record the adjusting entry assuming that Amble records the purchase of office supplies by initially debiting an asset account. Post the adjusting entry to the Office Supplies and Supplies Expense T-accounts. Make sure to include the beginning balance and purchase of office supplies in the Office Supplies T-account. Begin by recording the adjusting entry assuming that Amble records office supplies by initially debiting an asset account. (Record debits first, then credits. Select the explanation on the last line of the joumal entry.) Date Accounts and Explanation Debit Credit Now post the adjusting entry to the Office Supplies and Supplies Expense T-accounts. Enter the beginning balances on the first line of each account. Use a "Jan. 1" reference to show the beginning balance. Make sure to include the purchase of office supplies in the Office Supplies T-account, then post the adjusting entry. Use a "Bal." reference to show the ending balance of each account. (For accounts with a $0 unadjusted balance, make sure to enter "0" on the normal side of the accounts.) Office Supplies Supplies Expense Requirement 2. Record the adjusting entry assuming that Amble records the purchase of office supplies by initially debiting an expense account. Post the adjusting entry to the Office Supplies and Supplies Expense T-accounts. Make sure to include the beginning balance in the Office Supplies T-account, and the purchase of office supplies in the Supplies Expense T-account. Begin by recording the adjusting entry assuming that Amble records office supplies by initially debiting an expense account. (Record debits first, then credits. Select the explanation on the last line of the joumal entry.)

Answer 1

Req. 1

Date Debit Credit 38001 Accounts and explanation Supplies expense Office supplies (1,200+3,500-900) (To adjust the supplies account) 38001

Jan. 1 Purchase Office supplies $ 1,200 $3,500 Dec. 31 Adj. Jan. 1 Dec. 31 Adj. Supplies expense $0 $ 3,800 $3,800 Bal. $ 900 Bal. $ 3,800

Req. 2

Date Credit Debit 300 Accounts and explanation Supplies expense Office supplies (1,200 - 900) (To adjust the supplies account) 300

Jan. 1 Office supplies $ 1,200 Dec. 31 Adj. $300 Jan. 1 Purchase Dec. 31 Adj. Bal. Supplies expense $0 $3,500 $ 300 $ 3,800 Bal. $ 900

Req. 3:

The ending balance in the office supplies account and supplies expense account are same regardless of which of the two approaches used.