Goshen City acquires $36,000 of inventory on November 1, 20X5, having held no inventory previously. On December 31, 20X5, the end of Goshen City's fiscal year, a physical count shows $7,000 still in stock. During 20X6, $5,000 of this inventory is used, resulting in a $2,000 remaining balance of supplies on December 31, 20X6.Based on the preceding information, which of the following would be the correct account balances for 20X5 if Goshen City used the consumption method of accounting for inventories? ExpendituresInventory ofSuppliesA. $29,000 $0 B.$36,000 $0 C.$29,000 $7,000 D.$36,000 $7,000
A. Option A
B. Option B
C. Option C
D. Option D
Answer: C
Business
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