During its first three months of operations, Cari's Bakery, Inc. purchased supplies such as plates, napkins, bags, and cutlery for $9,000 and recorded this as supplies inventory. Supplies on hand at the end of the first quarter, amount to $5,600.

To prepare financial statement for the first quarter, the company must record which of the following accounting adjustments? Select one:

a. Increase Supplies expense by $5,600 and decrease Supplies inventory by $5,600 b. Increase Supplies inventory by $5,600 and decrease Supplies expense by $5,600 c. Increase Supplies inventory by $3,400 and decrease Supplies expense by $3,400 d. Increase Supplies expense by $3,400 and decrease Supplies inventory by $3,400 e. None of the above