Question

On-Time Truckers prepares monthly financial statements. On July 1, the Supplies account had a balance of $3,500. During July, additional supplies were purchased for $4,800 and that amount was debited to Supplies Expense. On July 31, a physical count of supplies revealed that there was $2,200 on hand.Prepare the adjusting journal entry that On-Time Truckers should make on July 31. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Answer 1

Step-by-step explanation:

The adjusting entry is shown below:

Supplies expense A/c Dr $6,100

To supplies A/c $6,100

(Being supplies account is adjusted)

The supplies expense is computed by

= Supplies beginning balance + purchase of supplies - supplies on hand

= $3,500 + $4,800 - $2,200

= $6,100

To find out the adjusting balance we added the purchase of supplies and deducted the supplies on hand from the beginning balance of supplies account