Assume that no reversing entries are made by the entity. How would theentity record the transaction for payment of wages if $5200 was accruedfor wages at the end of the year and the first payment of wages in thefollowing year was $63 900?O DR Salaries expense $63 900; CR Cash $63 900O DR Salaries expense $63 900; CR Salaries payable $5200; CR Cash $58 700O DR Salaries expense $69 100; CR Salaries payable $5200; CR Cash $63 900O DR Salaries payable $5 200; DR Salaries expense $58 700; CR Cash $63 900

Solution: Accrued salaries and wages are recorded through Salaries payable. In next period, when…

Assume that no reversing entries are made by the entity. How would the entity record the transaction for payment of wages if $5200 was accrued or wages at the end of the year and the first payment of wages in the ollowing year was $63 900?

Assume that no reversing entries are made by the entity. How would the entity record the transaction for payment of wages if $5200 was accrued or wages at the end of the year and the first payment of wages in the ollowing year was $63 900?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Payroll Entries

Payroll is a comprehensive record of employees that are paid by the company. Payroll classifies employees into various categories according to their function and pays scale (basic wage, allowance, income tax, other taxes, employee loans, etc.). Payroll processes form the bedrock of every organization as it contains sensitive information on the ‘wage and paycheck’ portion of the company’s strength—its employees. The organization needs to keep a track of the employees currently on the payroll, the net payout for the company, the record of transactions related to the employees including deductions and payroll taxes to identify the liability and its effect on the balance sheet (and other financial statements). Payroll records also include qualitative factors such as the conduct of the employee.

Question

Assume that no reversing entries are made by the entity. How would the
entity record the transaction for payment of wages if $5200 was accrued
for wages at the end of the year and the first payment of wages in the
following year was $63 900?
O DR Salaries expense $63 900; CR Cash $63 900
O DR Salaries expense $63 900; CR Salaries payable $5200; CR Cash $58 700
O DR Salaries expense $69 100; CR Salaries payable $5200; CR Cash $63 900
O DR Salaries payable $5 200; DR Salaries expense $58 700; CR Cash $63 900

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