Office Supplies
Office supplies include such items as paper, toner cartridges, and writing instruments. They are typically of such low cost that they are charged to expense as incurred. Under the accrual basis of accounting, some organizations record unused office supplies in an asset account, such as Supplies on Hand, and charge items to expense as they are consumed; however, the administrative effort required to do so does not usually justify the increased level of accounting accuracy, and so is not recommended.
When supplies are initially recorded in the supplies expense account, the offsetting credit is usually to the accounts payable account. If the supplies are instead paid for with cash, the offsetting credit is to the cash account.
Presentation of Supplies on Hand
The Supplies on Hand asset account is classified within current assets, since supplies are expected to be consumed within one year.
Examples of Factory Supplies
Janitorial supplies
Machine lubricants
Rags
Solvents
Examples of Office Supplies
Desk supplies
Forms
Light bulbs
Paper
Pens and pencils
Toner cartridges
Writing instruments
