The employees of Neat Clothes work Monday through Friday. Every other Friday the company issues payroll checks totaling $27,000. The current pay period ends on Friday, July 3. Neat Clothes is now preparing quarterly financial statements for the three months ended June 30. What is the adjusting entry to record accrued salaries at the end of June?Account TitleDebitCreditSalaries expense5,400 Salaries payable 5,400 Account TitleDebitCreditSalaries expense18,900 Salaries payable 18,900 Account TitleDebitCreditPrepaid salaries8,100 Salaries payable 8,100 Account TitleDebitCreditSalaries expense18,900 Prepaid salaries8,100 Salaries payable 27,000

First, we need to understand the problem. The company pays its employees every other Friday,…

Answered: The employees of Neat Clothes work…

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter4: The Adjustment Process

Section: Chapter Questions

Problem 7EB: Reviewing payroll records indicates that one-fifth of employee salaries that are due to be paid on...

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Question

The employees of Neat Clothes work Monday through Friday. Every other Friday the company issues payroll checks totaling $27,000. The current pay period ends on Friday, July 3. Neat Clothes is now preparing quarterly financial statements for the three months ended June 30. What is the adjusting entry to record accrued salaries at the end of June?

Account Title Debit Credit

Salaries expense 5,400

Salaries payable 5,400
Account Title Debit Credit

Salaries expense 18,900

Salaries payable 18,900
Account Title Debit Credit

Prepaid salaries 8,100

Salaries payable 8,100
Account Title Debit Credit

Salaries expense 18,900

Prepaid salaries 8,100

Salaries payable 27,000