At the end of the month, Swell Ltd shows a balance in Salaries payable of $62,000. The next payroll amounting to $97,000 is to be paid in the following month. What will be the journal entry to record the payment of salaries?
Correct!
Debit Salaries expense 35,000; Debit Salaries payable 62,000; and Credit Cash 97,000
Debit Salaries payable 35,000; Debit Salaries expense 62,000; and Credit Cash 97,000
Debit Salaries expense 97,000; and Credit Salaries payable 97,000
Debit Salaries expense 62,000; and Credit Cash 62,000
Debit Salaries expense 97,000; and Credit Cash 97,000
The correct journal entry to record the payment of salaries at the end of the month would be:
Debit Salaries expense 35,000; Debit Salaries payable 62,000; and Credit Cash 97,000
This entry recognizes the current month's salary expense of $35,000 (the difference between the previous balance and the next payroll), clears the outstanding balance in Salaries payable with a debit, and records the cash outflow for the total payroll payment of $97,000.
