Question

fill in the blank question supplies are (assets/expenses/liabilities) until they are used. when they are used up, their costs are reported as (assets/expenses/liabilities).

Explanation:

• Unused supplies are resources owned by a business with future economic value, so they are classified as assets.
• Once supplies are consumed, their cost is recognized as an expense to match the period in which the supplies were used to generate revenue, following accrual accounting principles.

Answer:

1. assets
2. expenses