Question
At March 1, Psychocandy Inc. reported a balance in Supplies of $200. During March, the company purchased supplies for $750 and consumed supplies of $800.
At March 1, Psychocandy Inc. reported a balance in Supplies of $200. During March, the company purchased supplies for $750 and consumed supplies of $800. If no adjusting entry is made for supplies:
a. stockholders' equity will be overstated by $800. b. expenses will be understated by $750. c. net income will be understated by $800. d. assets will be understated by $250.
Explain your answer.
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Accounting An Introduction
Authors: Atrill Peter, Eddie McLaney
6th Edition
0273771833, 978-0273771838
