Accrued Expenses Accrued expense refers to the expenses those are unpaid, but the goods and services related to the payment are received in a particular accounting period. These accrued expenses are payable for the business. Business treats accrued expenses as a liability. Adjusting Entries Adjusting entries indicates those entries, which are passed in the books of accounts at the end of one accounting period. These entries are passed in the books of accounts as per the revenue recognition principle and the expenses recognition principle to adjust the revenue, and the expenses of a business in the period of their occurrence. Rule of Debit and Credit: Debit - Increase in all assets, expenses & dividends, and decrease in all liabilities and stockholders’ equity . Credit - Increase in all liabilities and stockholders’ equity, and decrease in all assets & expenses. To record: The adjusting entry for the accrued salary for the period ending on Wednesday.

Question

Journalizing and posting an adjusting entry for accrued salaries expense Birch Park Senior Center has a weekly payroll of $12,500. December 31 falls on Wednesday, and Birch Park Senior Center will pay its employees the following Monday (January 5) for the previous full week. Assume Birch Park Senior Center has a five-day workweek and has an unadjusted balance in Salaries Expense of $620,000. Requirements Record the adjusting entry for accrued salaries on December 31. Post the adjusting entry to the accounts involved, and show their balances after adjustments. Record the journal entry for payment of salaries made on January 5.

Answer 1

Question

Chapter 3, Problem 3.13EX

(a)

To determine

Accrued Expenses

Accrued expense refers to the expenses those are unpaid, but the goods and services related to the payment are received in a particular accounting period. These accrued expenses are payable for the business. Business treats accrued expenses as a liability.

Adjusting Entries

Adjusting entries indicates those entries, which are passed in the books of accounts at the end of one accounting period. These entries are passed in the books of accounts as per the revenue recognition principle and the expenses recognition principle to adjust the revenue, and the expenses of a business in the period of their occurrence.

Rule of Debit and Credit:

Debit - Increase in all assets, expenses & dividends, and decrease in all liabilities and stockholders’ equity.

Credit - Increase in all liabilities and stockholders’ equity, and decrease in all assets & expenses.

To record: The adjusting entry for the accrued salary for the period ending on Wednesday.

(b)

To determine

To record: The adjusting entry for the accrued salary for the period ending on Thursday.

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