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Zen Arcade paid the weekly payroll on January 2 by debiting Salaries and Wages Expense for $47,000. The accountant preparing the payroll entry overlooked the fact that Salaries and Wages Expense of $27,000 had been accrued at year end on December 31. The correcting entry is

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mltn1980

Answer:

The correcting entry is reverse the entry on December 31:

Dr Salaries and Wages EXPENSES of $27,000

Cr Salaries and Wages PAYABLE of $27,000

Explanation:

At the moment of the accrued entry, on December 31

the company registered :

Dr Salaries and Wages PAYABLE of $27,000

Cr Salaries and Wages EXPENSES of $27,000

That was just an accrued entry to recognize the expenses to the balance sheet, but at the moment of the real expenses on January 2, this entry it's reverse and then the real expenses recorded in the balance sheet.

Dr Cash of $47,000

Cr Salaries and Wages EXPENSES of $47,000

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