Question

A company pays each of its two office employees each Friday at the rate of $140 per day for a five-day week that begins on Monday. If the monthly accounting period ends on Tuesday and the employees worked on both Monday and Tuesday, the month-end adjusting entry to record the salaries earned but unpaid is: 

Multiple Choice 

• Debit Salaries Payable $560 and credit Salaries Expense $560. 

• Debit Salaries Expense $560 and credit Salaries Payable $560. 

• Debit Salaries Expense $840 and credit Salaries Payable $840 

• Debit Unpaid Salaries $840 and credit Salaries Payable $840. 

• Debit Salaries Expense $560 and credit Cash $560.

Answer 1

Salary expense per employee = $140 per day

Number of employees = 2

Salary expense for 2 days = Salary expense per employee x Number of employees x 2

= 140 x 2 x 2

= $560

The following adjusting entry will be made to record the salary expense:

Date	Account title	Debit	Credit
	Salaries expense	560
	Salaries payable		560
	(To record salaries expense for 2 days)

Hence, second option is correct.