Question

Required information

Liabilities for health and pension benefits, warranties, and bonuses are recorded with estimated amounts. These items are recognized as expenses when incurred and matched with revenues generated.
As of December 31, Marr, Inc., has accrued benefits to its employees for medical insurance (in the amount of $12,000) and a contribution to a retirement program (at 10 % of the employees' $200,000 gross salary). Prepare the December 31 entry for Marr by selecting the account names from the drop-down menus and entering the dollar amounts in the debit or credit columns.

Answer 1

Dr Employee benefits expenses 32,000

Cr Employee medical insurance payable 12,000

Cr Employee retirement program payable 20,000

Step-by-step explanation:

Preparation for the December 31 entry for Marr

Dr Employee benefits expenses 32,000

(20,000+12,000)

Cr Employee medical insurance payable 12,000

Cr Employee retirement program payable 20,000

($200,000*10%)

(Being to record employee benefits expenses)