ment with a beginning inventory of supplies of s100 in its General Fund and had

Question

ment with a beginning inventory of supplies of s100 in its General Fund and had the following transactions during the year (all amounts are in thousands). 1. Ordered supplies with an estimated cost of $3,150. the encumbered amount. 3. Paid $2.300 on account for supplies received in #2. . During the year, the inventory warehouse issued $2,900 in supplies to general government departments. 2. Received supplies with an actual invoice cost of $2,920. No payment was made upon receipt, $2950 was The ending physical inventory of General Fund supplies found $150 on hand at year end. Reauired Uaing the Consumption method of accounting for inventory, prepare the general journal entries required to account for the previous information.

Explanation / Answer

1.Encumbered Account Dr 3150

To Reserve fo Encumbered A/c 3150

2.Reseve for Encumberes A/c Dr 3150

To Encumbered Account 3150

3.Expenditure A/c Dr 2920

To Vouchers Payable A/c 2920

4. Vouchers Payable A/c Dr 2300

To Cash/Bank A/c 2300   

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