Question

1. a $375 purchase of supplies on account was recorded by debiting supplies for $375 and crediting cash for $375. what is the journal entry needed to correct this error?

Explanation:

Step1: Identify the error

The original entry wrongly credited Cash instead of Accounts Payable since it was a purchase on account.

Step2: Reverse the incorrect entry

We need to reverse the credit to Cash and create a proper credit to Accounts Payable.
Debit Cash $375 and credit Accounts Payable $375.

Answer:

Debit: Cash $375
Credit: Accounts Payable $375