Question

Athena Company provides employee health insurance that costs $15,100 per month. In addition, the company contributes an amount equal to 4% of the employees' $151,000 gross salary to a retirement program. The entry to record the accrued benefits for the month would include a:

Answer 1

Answer:

Debit to Employee Benefits Expense $21,140

Explanation:

Preparation of Athena Company entry to record the accrued benefits for the month

Using this formula

Accrued Expenses = Gross salary ×Percentage of the amount contributed+ Insurance cost

Let plug in the formula

Accrued Expenses= $151,000 × 0.04

= $6,040 + $15,100

= $21,140

Debit to Employee Benefits Expense $21,140.

Therefore the entry to record the accrued benefits for the month would include a: Debit to Employee Benefits Expense $21,140.