Question text

XYZ Co.purchased supplies costing $5,000 on 1/1/2020 and recorded the transaction by increasing assets.At the end of the year $2,000 of the supplies are still in hand.if XYZ co does not make the adjusting entry what is the impact on XYZ, co statement of financial position at 31/12/ 2020

Select one:

a. Assets overstated by $2,000

b. equity understated by $2,000

c. Assets overstated by $3,000

d. equity overstated by $2,000