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    taiyangsheng's Avatar
    taiyangsheng Posts: 1, Reputation: 1
    New Member
    		  
    #1

    Sep 3, 2006, 07:55 PM
    Accounting question
    How to do this entry,

    In the unadjusted trial balance sheet ,Supplies balance is 0. Supplies expense balance is debit 2000. And the company debits supplies expense when supplies are purchased . Supplies on hand at year end cost 500.

    Dr supplies expense 500
    Cr: Supplies 500

    Am I right
    CaptainForest's Avatar
    CaptainForest Posts: 3,645, Reputation: 393
    Ultra Member
    		  
    #2

    Sep 4, 2006, 12:50 PM
    No, you are not.

    During the year, what they did was (total)

    Dr. Supplies Expense 2,000
    Cr. Cash 2,000

    But, they have 500 left, so they should have only done it 1,500

    So you need to take out 500

    Dr. Supplies 500
    Cr. Supplies Expense 500

    You were almost there, you just mixed up which should be a debit and which should be a credit.
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