Question

Total weekly salaries expense for all employees is $10,000. This amount is paid at the end of the day on Friday of each five-day workweek. April 30 falls on a Tuesday, which means that the employees had worked two days since the last payday. The next payday is May 3. Prepare the required adjusting entry, if any.

Answer 1

Answer:Please see answer in explanation column

Explanation:

A) Journal to record accrued salaries on April 30, which is a pay day

Date             Accounts                       Debit                      Credit

April 30    Salaries expense             $4000  

                Salaries Payable                                               $4,000

Calculation:

salaries expense = Principal amount x period  (which fell on tuesday)

= 10,000 x 2/5 = $4,000

b) Journal to record accrued salaries on April 30 and current salaries on May 3

Date             Accounts                       Debit                      Credit

May 3    Salaries      Payable        $4000  

                Salaries expense           $6,000

                   Cash                                                               $10,000

Calculation:

salaries expense = Principal amount x period(remaining 3 day work period)

= 10,000 x 3/5 = $6,000