Question

Sherriane Baby Products’ salaries expense was $15.1 million. Required: What is the amount of cash Sherriane paid to employees during the reporting period if its salaries payable increased by $5.7 million? Prepare a summary entry that represents the net effect of salaries expense incurred and paid during the reporting period.

Answer 1

Answer:

Summary entry is shown below

Explanation:

The preparation of the summary entry is shown below

Salary expense $15.1 million

     To Cash $9.4 million

     To Salary payable $5.7 million

(Being the salary expense is recorded)

Simply we debited the salary expense by $15.1 million as the expenses account is debited while on the other hand, the cash is paid for $9.4 million and the salary payable is credited for $5.7 million