Adjusting Entry in Accounting

What is the adjusting entry needed in this scenario?

At the beginning of the period, the supplies account has a balance of 500. At the end of the period, the balance was 275. Assuming the company made no purchases, what is the adjusting entry?

A: Debit suppliers expense 225, credit supplies 225

B: Debit supplies 225, credit supplies expense 225

C: Debit supplies expense 275, credit supplies 275

D: Debit supplies 275, credit supplies expense 275

Answer:

The correct adjusting entry would be to debit supplies expense and credit supplies for an amount of $225.

The subject of this question is about adjusting entries in accounting. The adjusting entry required in this situation would be option A: debit supplies expense and credit supplies. It indicates that you are reducing the supplies and recognizing that the amount has been used during the period. The dollar amount should be $225 because the balance at the beginning of the period was $500 and it went down to $275 at the end of the period. Therefore, $500 - $275 equals a $225 reduction in supplies, which represents the expense for the period.