Question

Exercise 2-21 (Algo) Reversing entries (Appendix 2B) The employees of Xitrex, Inc., are paid each Friday. The company's fiscal year-end is June 30, which falls on a Wednesday for the current year. Salaries are earned evenly throughout the five-day work week, and $21,000 will be paid on Friday, July 2. Required: 1. Prepare an adjusting entry to record the accrued salaries as of June 30, a reversing entry on July 1, and an entry to record the payment of salaries on July 2 2. Prepare journal entries to record the accrued salaries as of June 30 and the payment of salaries on July 2 assuming a reversing entry is not recorded. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare an adjusting entry to record the accrued salaries as of June 30, a reversing entry on July 1, and an entry to record the paymer of salaries on July 2. (If no entry is required for a transaction/event, select "No journal entry required in the first account field.) View transaction list View journal entry worksheet Debit Credit 1 Record the accrued salaries as of June 30. Required 2 > 2 Record the reversing entry on July 1. 3 Record the payment of salaries on July 2.

Answer 1

Credits 1) Journal entries, assuming reversal entries are made :- Date Accounts Title & Explanation Debit $ 30-Jun Wages expense (21000/5)*3 12,600 To Wages Payable (Entry for recording of wages accrued for 3 days of June) 12,600 01-Jul Wages Payable 12,600 To Wages expense (Entry for reversal of accrued wages recorded as on 30th June) 12,600 21,000 02-Jul Wages expense To Cash (Entry for payment of wages) 21,000 Credit S 2) Journal entries, assuming no reversal entries are made :- Date Accounts Title & Explanation Debit 30-Jun Wages expense (21000/5)*3 12,600 To Wages Payable (Entry for recording of wages accrued for 3 days of June) 12,600 02-Jul Wages expense (21000/5)2 8,400 Wages Payable 12,600 To Cash 21,000 (Entry for recording of payment of wages and wage expense for july 2 days)