Question

Ski Master Company pays weekly salaries of $3,100 on Friday for a five-day week ending on that day. Required: Journalize the necessary adjusting entry at the end of the accounting period, assuming that the period ends on Wednesday. Refer to the Chart of Accounts for exact wording of account titles.

Answer 1

Solution:

3,100 / 5 = 620 per day

So the wages outstanding we need to pay still are the 3 days left in the year (the work was done so we must match the revenues and expenses)

Wages Expense = 620 * 3 = 1,860

Wages Payable......1,860

(620 * 3) to accrue wages that have not yet been paid