To determine the appropriate journal entry at yearend for Blue Spruce Corp, we need to follow these steps:
1. Identify the opening balance in the supplies account:
- The opening balance in the supplies account is [tex]$\$[/tex]2780[tex]$.
2. Add the purchases of supplies during the year:
- Blue Spruce Corp purchased $[/tex]\[tex]$3480$[/tex] worth of supplies during the year.
3. Calculate the total supplies available during the year:
- Total supplies available = Opening balance + Purchases
- Total supplies available = \[tex]$2780 + \$[/tex]3480 = \[tex]$6260
4. Determine the yearend supplies inventory:
- The yearend physical count shows \$[/tex]3250 in supplies inventory.
5. Calculate the amount of supplies used during the year:
- Supplies used = Total supplies available - Yearend inventory
- Supplies used = \[tex]$6260 - \$[/tex]3250 = \[tex]$3010
6. Record the appropriate journal entry:
- Based on the supplies used during the year, we need to record the expense.
- The journal entry at yearend should recognize the supplies expense incurred and reduce the supplies account accordingly.
The journal entry is:
- Dr Supplies Expense \$[/tex]3010
- Cr Supplies \[tex]$3010
This entry properly accounts for the supplies used during the year by recording the expense and adjusting the supplies account. Therefore, the appropriate journal entry at yearend is:
Dr Supplies Expense \$[/tex]3010
Cr Supplies \$3010
