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-   -   Adjusting journal entries (https://www.askmehelpdesk.com/showthread.php?t=529656)

  • Nov 28, 2010, 06:53 AM
    StaceyShaw
    Adjusting journal entries
    I have an unadjusted trial balance. All original entries involving cash have been made, but some entries were recorded incorrectly. I have to prepare in journal entry form all adjusting and correcting journal entries. This is one of my questions. I'm not sure what to do with last years balance and the proper adjusting or reversing journal entry. I have to do Per a physical count of office supplies, $3,141 of supplies remained at the end of 2010. The balance on the worksheet in the office supplies account represents last years ending balance of $2,500. During the year, $7,500 of office supplies was purchased and immediately expensed.
  • Nov 28, 2010, 11:41 AM
    pready

    First thing you should do is subtract the $7,500 from Office Supplies Expense and add this amount to Office Supplies (this acccunt is a current asset). The entry for this should be: Debit Office Supplies for the amount and Credit Office Supplies Expense for the amount (this is to correct a previously incorrect journal entry). The $7,500 + the $2,500 ending balance is your new account balance. Now you can do an adjusting entry to record the supplies used during the period. The amount used will be your Office Supplies account balance minus your physical inventory amount. The adjusting entry to record the supplies used is: Debit Office Supplies Expense for the amount and Credit Office Supplies for the amount. Your ending Office Supplies account balance will now equal your physical inventory amount onhand.

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