Accounting Adjustments for Prepaid Expense

Flashcards covering key accounting concepts related to adjustments for prepaid expenses.

Adjustment for Prepaid Expense

An accounting entry made to adjust the expenses associated with prepaid accounts at the end of a financial period.

Supplies Expense

A debit account used to record the cost of supplies that have been consumed during the accounting period.

Beginning Balance

The initial amount of money in an account at the beginning of a financial period.

Debited

A type of accounting entry that increases asset or expense accounts.

Supplies on Hand

The amount of supplies that remain available at the end of the accounting period.

Journalize

The process of recording transactions in a journal, detailing debits and credits.

Adjusting Entry

An entry made at the end of an accounting period to allocate income and expenses to the correct periods.

Total Supplies Purchased

The total amount spent on supplies during the accounting period.

Calculation of Supplies Expense

Total supplies purchased minus supplies on hand at the end of the period.

$3,375

Beginning balance in the supplies account.

$2,980

Amount of supplies remaining on hand at the end of the year.

$6,450

Total debited for supplies purchased during the year.

$6,845

Total adjusting entry required for supplies expense at year-end.