Question

By the end of the accounting, and please have one salaries of $500 but they will not be paid until the following pay. What is the following proper adjusting entry?

Answer 1

The proper adjusting entry for unpaid salaries at the end of an accounting period is to debit Salaries Expense and credit Salaries Payable for $500. This reflects the expense incurred and records the liability to pay the salaries in the future.

Step-by-step explanation:

The proper adjusting entry at the end of the accounting period for unpaid salaries of $500 would include debiting Salaries Expense and crediting Salaries Payable to acknowledge the expense incurred during the period, even though the cash has not been paid out yet. This follows the accrual basis of accounting, which matches expenses with the revenue they help to generate, regardless of the timing of the actual cash flow.

Debit: Salaries Expense $500
Credit: Salaries Payable $500

This entry increases the expenses on the income statement, which decreases the net income for the period, and adds a liability on the balance sheet, representing an obligation to pay the employee in the next period.