The Yeats Company recorded the following adjustment in general journal form: Which of the following choices accurately reflects how this event would affect the company's financial statements?
A)Option A
B)Option B
C)Option C
D)Option D

Question

The Yeats Company recorded the following adjustment in general journal form:  Which of the following choices accurately reflects how this event would affect the company's financial statements? 
A)Option A 
B)Option B 
C)Option C 
D)Option D

Quizplus · Accepted Answer

The adjusting entry to recognize supplies expense decreases assets and increases expenses, which decreases net income and decreases equity. As with all adjusting entries, it does not affect cash flows.

The Yeats Company Recorded the Following Adjustment in General Journal