A company pays each of its two office employees each Friday at the rate of $220

Question

A company pays each of its two office employees each Friday at the rate of $220 per day for a five-day week that begins on Monday. If the monthly accounting period ends on Tuesday and the employees worked on both Monday and Tuesday, the month-end adjusting entry to record the salaries earned but unpaid is: Multiple Choice Debit Unpaid Salaries $1,320 and credit Salaries Payable $1.320 Debit Salaries Expense $880 and credit Salaries Payable $880 Debit Salaries Expense $1,320 and credit Salaries Payable $1,320 Debit Salaries Payable $880 and credit Salaries Expense $880 Debit Salaries Expense $880 and credit Cash $880

Explanation / Answer

Correct answer is : Debit salaries expense and credit salaries payable $880 Workings: Month end adjusting entry to record salary earned but unpaid: Account Titles and Explaination Debit Credit Salaries Expense $ 880 Salaries Payable $        880 (Being Salary due recorded) (a) Number of Employees = 2 (b) Rate per day = $        220 (c) Total number of days salary unpaid (Monday + Tuesday) = 2 Salaries Payable = (a) X (b) X (c) = 2 X $220 X 2 days = $        880

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