Question

Wiley Consulting purchased $7,000 worth of supplies and paid cash immediately. Which of the following general journal entries will Wiley Consulting make to record this transaction? Assume the company's policy is to initially record prepaid and unearned items in balance sheet accounts.(A) Account Payable 7000 Supplies 7000(B) Cash 7000 Supplies 7000(C) Supplies 7000 Cash 7000(D) Supplies 7000 Account payable 7000(E) Supplies expenses 7000 Account payable 7000

Answer 1

Answer:

(C) Supplies 7000 Cash 7000

Explanation:

In this transaction, Willey consulting acquired $7,000 worth of supplies, which configures as a credit of $7,000 to the Supplies account. Meanwhile, the company has incurred a cash expense, which should reflect in a $7,000 debit to the Cash account.

Therefore, the answer is (C) Supplies 7000 Cash 7000.