At the beginning of December, Global Corporation had $1,200 in supplies on hand. During the month, supplies purchased amounted to $2,900, but by the end of the month the supplies balance was only $1,600. What is the appropriate month-end adjusting entry?

Explanation:

The month-end adjusting entry is as follows

Supplies expense A/c Dr $2,500

          To Supplies A/c  $2,500

(Being supplies account is adjusted for $2,500)

The supplies expense is calculated below

= Supplies balance + purchase made - supplies on hand

= $1,200 + $2,900 - $1,600

= $2,500

Basically we debited the supplies expense account and credited the supplies account for $2,500

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