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BLeitt
Oct 4, 2011, 06:42 AM
Office supplies has a balance of $2400. An inventory at Dec 31 shows $1700 of supplies on hand. How do I adjust this in order to close for the financial statements?

pready
Oct 4, 2011, 01:48 PM
First you will have to calculate the difference between what your account balance is and your actual balance.

Your journal entry will be:
Debit Office Supplies Expense for the amount above
Credit Office Supplies for the amount above

This journal entry will bring your account balance into agreement with your actual inventory balance.