salaries of $5,000 have been earned by employees by the end of the period but will not be paid to employees until the following period. How should the expense and related liability be recorded? Why?
2007-11-29 00:06:17 · 3 answers · asked by ameri0903 3 in Business & Finance ➔ Other - Business & Finance
The journal entry is:
Dr Salaries expense 5,000
Cr Salaries payable 5,000
The salaries have been earned, so they must be recorded, in order to hit the income statement. Since they're not paid, the co. owes the workers, so the liability must also be recorded, in the balance sheet.
2007-11-29 00:17:47 · answer #1 · answered by Sandy 7 · 1⤊ 1⤋
If you are using accrual accounting, you will need to accrue the expense to the period it was earned.
2007-11-29 08:15:14 · answer #2 · answered by Anonymous · 0⤊ 0⤋
well I guess you have Debit accrue salary and credit salary payable....
but I am not 100 % sure,,,,
hope it helps!
2007-11-29 08:15:52 · answer #3 · answered by :) 3 · 0⤊ 1⤋