The vintage laundry company purchased $6,500 worth of laundry supplies on june 2 and recorded the purchase as an asset. on june 30, an inventory of the laundry supplies indicated only $1,000 on hand. the adjusting entry that should be made by the company on june 30 is: a)debit supplies expense, $1,000; credit supplies, $1,000.b)debit supplies, $5,500; credit supplies expense, $5,500.c)debit supplies, $1,000; credit supplies expense, $1,000.d)debit supplies expense, $5,500; credit supplies, $5,500.

D.) debit Supplies Expense. $5,500; credit Supplies, $5,500

Explanation:

First, let's talk about the amount.

On June 2 they purchased supplies worth $6,500 and recorded it as an ASSET. Debited on "Supplies" Account

Then on June 30, only $1,000 is on hand. That means that $5,500 worth of supplies must have been used (Solved as 6,500 less 1,000)

Now, the entry should reduce the "Supplies" Account since there were only $1,000 left. So it's correct to credit Supplies for $5,500 to reduce $6,500 into $1,000 worth.

The corresponding debit would consequently be "Supplies Expense" since $5,500 worth of supplies was used for the month.

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