Question

Gordy's Corp. has seven employees. Each earns $800 per week for a five day work week ending on Friday. This month, the last day of the month falls on a Thursday. The company should make an adjusting entry:

Answer 1

The journal entry to record the wages expense for the month is:

Thursday, end of month, wages expense:

Dr Wages expense 640

Cr Wages payable 640

The adjusting entry made on Friday would be:

Friday, first day of the new month, wages expense:

Dr Wages expense 140

Dr Wages payable 640

Cr Cash 800