Which of the Following Is Not Correct with Respect to Accounting

Multiple Choice

Which of the following is not correct with respect to accounting for supplies inventories in a governmental fund?

A) Typically, supplies inventory is a significant portion of governmental fund balances.
B) Supplies inventories may be recorded using either the purchase method or the consumption method.
C) An amount equal to the ending balance of supplies is reported as Nonspendable Fund Balance.
D) The consumption method is preferable over the purchase method since it requires no adjustment to supplies expense when preparing the government-wide statements.