Question

Eagle Company reported Salaries and Wages Payable of $1,500 at the beginning of the year and $5,000 at the end of the year. The income statement for the year reported Salaries and Wages Expense of $112,400. How much cash was paid for salaries and wages during the year?

Answer 1

Given:

Wages payable at the beginning of the year = $1500

Wages payable at the end of the year = $5000

Salaries and wages expense as per the income statement = $112400

To find:

Cash paid for salaries and wages

Solution:

The calculation of the cash paid for salaries and wages is as follows,

Wages payable at the end of the year-Wages payable at the beginning of the year = $\ 5000-\ 1500=\ 3500$

Cash paid = $\ 112400-\ 3500=\ 1,08,900$

Therefore, the cash paid for salaries and wages during the year is $1,08,900.

Wages and salaries are paid by the organization or management to the workers or the employees in return for the work done by them for the company.