A company pays salaries and wages every two weeks. Salaries and wages amount to

Question

A company pays salaries and wages every two weeks. Salaries and wages amount to $100 a day and the company has a seven-day work week. On March 31, the company pays wages for the two weeks ending March 24 and recorded the related journal entry. The adjusting journal entry, dated March 31, to record unpaid wages and salaries owed since March 25 will include a debit to:

Salaries and Wages Payable and a credit to Salaries and Wages Expense for $1,400.

Salaries and Wages Expense and a credit to Salaries and Wages Payable for $700.

Salaries and Wages Payable and a credit to Cash for $700.

Salaries and Wages Expense and a credit to Salaries and Wages Payable for $1,400.

Explanation / Answer

Adjusting journal entry, dated March 31, to record unpaid wages and salaries owed since March 25 shall be as under:

Date

Accounts / Explanation

Debit

Credit

March. 31

Salaries and Wages Expense

$        700

Salaries and Wages Payable

$        700

(Being salary expense accrued and recorded)

(7 days * $100 = $700)

Hence Correct answer shall be :

Debit to Salaries and Wages Expense and a credit to Salaries and Wages Payable for $700.

Adjusting journal entry, dated March 31, to record unpaid wages and salaries owed since March 25 shall be as under:

Date

Accounts / Explanation

Debit

Credit

March. 31

Salaries and Wages Expense

$        700

Salaries and Wages Payable

$        700

(Being salary expense accrued and recorded)

(7 days * $100 = $700)

Hence Correct answer shall be :

Debit to Salaries and Wages Expense and a credit to Salaries and Wages Payable for $700.

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