...the accounts only at the end of ea? Franklin Company prepares annual financial reports and consequently adjusts the accounts only at the end of each fiscal year. The company’s accountant prepared the following trial balance after adjustments as of December 31, 2007:
Debit
Credit
Cash
$ 440
Accounts receivable
220
Office supplies
240
Office equipment
2,500
Accumulated depreciation, Office equipment
$ 250
Accounts payable
400
Common stock
2,000
Retained earnings
440
Dividends
250
Fees earned
750
Rent expense
190
$2,940
$2,940
However, the accountant failed to make two adjusting entries. Supplies left on hand at the end of the period amounted to only $180, and depreciation for the year was not recorded. The office equipment was purchased January 1, 2006 and has an expected life of 10 years.
Which of the following entries is necessary to make the adjustment for supplies used?
a. debit Supplies 60; credit Supplies expense 60
b. debit Supplies expense 60; credit Supplies 60
c. debit Supplies 180; credit Supplies expense 180
d. debit Supplies expense 180; credit Supplies 180
e. none of the above
Debit
Credit
Cash
$ 440
Accounts receivable
220
Office supplies
240
Office equipment
2,500
Accumulated depreciation, Office equipment
$ 250
Accounts payable
400
Common stock
2,000
Retained earnings
440
Dividends
250
Fees earned
750
Rent expense
190
$2,940
$2,940
However, the accountant failed to make two adjusting entries. Supplies left on hand at the end of the period amounted to only $180, and depreciation for the year was not recorded. The office equipment was purchased January 1, 2006 and has an expected life of 10 years.
Which of the following entries is necessary to make the adjustment for supplies used?
a. debit Supplies 60; credit Supplies expense 60
b. debit Supplies expense 60; credit Supplies 60
c. debit Supplies 180; credit Supplies expense 180
d. debit Supplies expense 180; credit Supplies 180
e. none of the above