The City of Upper Falls accounts for its inventory using the purchases method. During the year the City bought $400,000 of supplies, for which it owed $100,000 at year-end. The City will pay for the...

The City of Upper Falls accounts for its inventory using the purchases method. During the year the City bought $400,000 of supplies, for which it owed $100,000 at year-end. The City will pay for the supplies from available expendable financial resources. The entry that should be recorded in the City s General Fund is

a. Debit Expenditures $400,000; Credit Cash $300,000 and Accounts Payable $100,000.

b. Debit Expenditures $300,000; Credit Cash $300,000.

c. Debit Supplies Inventory $400,000; Credit Cash $300,000 and Accounts Payable $100,000.

d. Debit Supplies Inventory $300,000; Credit Cash $300,000.