At the beginning of 2020, the City of Fairview reported an Unassigned Fund Balance of $555,000 and a supplies inventory balance of $175,000. During the year, Fairview purchased $225,000 in supplies and used supplies of $220,000. The city reports inventory amounts of Fund Balance—Nonspendable.

Required:

A. Prepare the necessary journal entries under the purchases method.

B. Prepare the journal entries needed to account for the supplies under the consumption method.

C. What would the 12/31/20 balance in the Unassigned Fund Balance be under each method, if the only transactions of the fund are those involving the supplies?