On January 1, Squid Roe, Inc. had a supplies balance of $1,500. During the year, it purchased $40,000 of supplies on credit, of which $30,000 was paid. At the end of the year, it had $2,000 of supplies on hand. The amount of Supplies Expense for the year end December 31 equals $?

Explanation:

With the help of Preparing Suppllies Account we got the answer

                                 Supplies Account

                                                                      jan 1  By balance b/d         1,500

                 To Cash (expenses) Bal 9,500            By Purchase         40,000

                  To Bank (paid )             30,000

 Dec 31      To bal c/d                        2,000

So by preparing Supplies Account we got the balance amount of Expenses paid to supplies are 9,500 $

month 1 start amount =$3287.90 interest=(3287.90x0.0145/12)3.97 total to pay=$3291.81 paid =$1200 balance =$2,091.87

month 2 starting amount= $2,091.87 interest =$25.28 total to pay =$2117.15 paid =$1200 balance $917.15

month 3 starting amount =$917.15 interest =$11.08 total to pay =$928.23 paid =$928.23 balance =$0 total to pay 1200+1200+928.23 = $3328.23 it will take 3 months to pay a total of $3328.23

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