Reference no: EM132640769

Problem 1: The policy at Sheridan Company is to expense all office supplies at the time of purchase. On the last day of the accounting period, there are $920 of unused office supplies on hand and the balance of supplies expense is $2940. What should the accountant do?

Option 1: Debit Supplies Expense for $2020 and credit Supplies for $2020.

Option 2: Convince management to change its policy to avoid problems in the future.

Option 3: Debit Supplies and credit Supplies Expense for $920.

Option 4: Nothing, company policy says to expense supplies when purchased.