Question

At the beginning of May, Golden Gopher Company reports a balance in Supplies of $320. On May 15, Golden Gopher purchases an additional $1,500 of supplies for cash. By the end of May, only $120 of supplies remains. Required: 1.&2. Record the necessary entries in the Journal Entry Worksheet below. 3. Calculate the balances after adjustment on May 31 of Supplies and Supplies Expense.

Answer 1

Answer:

The answer of each requirement is given below.

The necessary entries in the Journal Entry

Two entries will be made one to record purchase and other to record expense.

Debit Supplies Stock Asset             $ 1,500

Credit Cash                                       $ 1,500

Debit Cost of Goos Sold Expense  $ 1,700 (320+1500-120)

Credit Supplies Stock Asset            $ 1,700

Calculate the balances

The supplies expense can be calculated as follow.

Opening balance + Purchase = Expensed out + Closing Balance

Supplies Expense = 320+1,500-120

Supplies Expense = $ 1,700

Answer 2

The journal entries for the requirement are given in the attachment. The supplies expense for the period is $1700.

What is supplies?

In business, the term supplies is used to refer the items purchased by the company and is used by it during the period. They are the current assets for the company until they are used and then charged as expense at the time of their use.

The common examples of supplies includes office supplies such as paper, files, staplers, or factory supplies such as raw material, and so on.

The supply account has  a debit balance and the expenses are credited in the account.

The supplies expense can be calculated as follows:

$\begin{aligned} \rm Supplies \: in\:the\:beginning + Purchases - Closing\: supplies &= \rm Supplies\: Expense \\\\\ 320 + \ 1500 - \ 120 &= \ 1700\end$

Therefore the balance on May 31 is $120 and the supplies expense is $1700.

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