Question

Colaw Co. pays all salaried employees on a biweekly basis. Overtime pay, however, is paid in the next biweekly period. Colaw accrues salaries expense only at its December 31 year end. Data relating to salaries earned in December 2012 are as follows:Last payroll was paid on 12/26/12, for the 2-week period ended 12/26/12.Overtime pay earned in the 2-week period ended 12/26/12 was $15,000.Remaining work days in 2012 were December 29, 30, 31, on which days there was no overtime.The recurring biweekly salaries total $270,000.Assuming a five-day work week, Colaw should record a liability at December 31, 2012 for accrued salaries of

Answer 1

Answer:

salaries expense   81,000  debit

    salaries payable               81,000 credit

Explanation:

the recurrring salaries for a biwweekly salaries is 270,000

In two weaks assuming five-day work week, there is 10 days.

so we divide to get the expected wages per day the recurring salaries by the amount of days of that period:

270,000 / 10 = 27,000 per day

Then, we multiply by the 3 days from the current period:

27,000 x 3 = 81,000

this will be the accrued expenses for the period