What is the journal entry to record office supplies charged to the doctor's account by an admin assistant?

• A. Debit office supplies; credit accounts receivable
• B. Debit accounts payable; credit office supplies expense
• C. Debit office supplies expense; credit accounts payable
• D. Debit accounts receivable; credit revenue

Answer: (C)

When you record a charge for office supplies, you’re recognizing an expense and, since the supplies were bought on credit (to be paid later), you also record a liability. The proper journal entry is to debit Office Supplies Expense to reflect the cost incurred and to credit Accounts Payable to show the obligation to pay for those supplies. This keeps the expense on the income statement and the payment obligation on the balance sheet.

Debiting Accounts Receivable would imply the doctor owes you money (an asset for you) rather than creating a liability to a supplier, and crediting Revenue would be inappropriate because this is not earning revenue. Likewise, reducing Accounts Payable would incorrectly decrease the liability when you’re increasing it by incurring the expense.