Question

The accrued salary expense journal entry is a debit to Salaries Expense and a credit to Salaries Payable for $1,000 on December 31. The company chooses not to record reversing entries and pays its weekly payroll of $5,000 on January 3 of the following year. The journal entry would include a _____.

(A) debit to Salaries Payable for $1000
(B) debit to Cash for $4000
(C) debit to Retained Earnings for $1000
(D) credit to Salaries Expense for $4000

Answer 1

(A) debit to Salaries Payable for $1000

Step-by-step explanation:

Initially the following entry was made to recognise accrued expense as at December 31

Debit Salaries Expense for $1,000

Credit Salaries Payable for $1,000

So the accrued $1,000 is temporarily put in Salary Payable

Note in January the balance of $4,000 will be debited from Salary Expense to make total debit for salary $5,000 for January salary.

When it is salary period the following entries will be posted

Debit Salaries Payable for $1,000

Debit Salaries Expense for $4,000

Credit Cash for $5,000