Question

Anthony Delivery Service has a weekly payroll of $32,000. December 31 falls on Tuesday and Anthony will pay its employees the following Monday (January 6) for the previous full week. Assume that Anthony has a five-day workweek and has an unadjusted balance in Salaries Expense of $925,000. What is the December 31 balance of Salaries Expense after adjusting entries are recorded and posted?

Answer 1

$937,800

Step-by-step explanation:

The adjusting entry would be

Salaries expense A/c $12,800

To Salaries payable A/c $12,800

(Being salary is adjusted)

The salaries expense is computed below:

= Total five days × number of days ÷ total number of days

= $32,000 × (2 ÷ 5)

= $12,800

Now the ending balance of salaries expense would be

= Unadjusting balance + adjusting balance

= $925,000 + $12,800

= $937,800