Which of the following correctly matches the activity to its effect on the general ledger accounts?A company purchases office supplies for cash.

• A. Debit Accounts Payable; Credit Supplies
• B. Debit Cash; Credit Supplies
• C. Debit Supplies Expense; Credit Accounts Payable
• D. Debit Supplies; Credit Cash

Answer: (D)

Verified step by step guidance

1. Step 1: Understand the transaction. The company is purchasing office supplies and paying for them in cash. This means the company is acquiring an asset (supplies) and reducing another asset (cash).
2. Step 2: Identify the accounts involved. The accounts affected are 'Supplies' (an asset account) and 'Cash' (another asset account).
3. Step 3: Determine the nature of the accounts. 'Supplies' will increase because the company is acquiring more supplies, and 'Cash' will decrease because the company is paying for the supplies.
4. Step 4: Apply the rules of debits and credits. In accounting, an increase in an asset account is recorded as a debit, and a decrease in an asset account is recorded as a credit. Therefore, 'Supplies' will be debited, and 'Cash' will be credited.
5. Step 5: Record the journal entry. The correct journal entry is: Debit 'Supplies' and Credit 'Cash'. This reflects the increase in supplies and the decrease in cash in the general ledger.