Question

Buster Industries pays weekly salaries of $30,000 on Friday for a five-day week ending on that day. The adjusting entry necessary at the end of the fiscal period ending on Tuesday is a. debit Salaries Payable, $12,000; credit Cash, $12,000 b. debit Salary Expense, $12,000; credit Dividends, $12,000 C. debit Dividends, $12,000; credit Cash, $12,000 d. debit Salary Expense, $12,000; credit Salaries Payable, $12,000

Answer 1

Answer:

The correct answer is D

Explanation:

The journal entry to be recorded for the salary is as:

Salary expense A/c...........................Dr   $12,000

     Salary Payable A/c...........................Cr   $12,000

Being the salary which is paid weekly, become accrued

Working Note:

Single day amount = Weekly payment / Number of days

= $30,000 / 5

= $6,000 per day

So, computing for 2 days (Monday and Tuesday) salary as:

Amount = Per day salary × Number of days

= $6,000 × 2

= $12,000