Question

Which of the following statements are accurate regarding supplies? (Check all that apply.) 

Check all that apply. 

• Unused supplies are treated as expenses. 

• When supplies are purchased, they are added to the supplies account. 

• Supplies are assets until they are used. 

• Unused supplies can be recorded as Store Supplies, Office Supplies or Supplies. 

• Supplies is considered a liability account. 

• Unused supplies are treated as assets.

Answer 1

All the supplies purchased during a particular time period are neither considered as an asset nor as an expense. Only used supplies are considered as an expense. Thus unused supplies at the end of the reporting period are considered as an asset. Supplies remaining unused can be recorded in the books by various names like store supplies, office supplies or supplies.

Thus,following statements are true regarding supplies:

(ii) When supplies are purchased, they are added to the supplies account.

(iii) Supplies are assets until they are used.

(iv) Unused supplies can be recorded as store supplies, office supplies or supplies

(vi) Unused supplies are treated as assets.

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