Bank 'n' Roll,Inc.pays its employees once a month and records the expense at the time of payment.On May 31,Bank 'n' Roll,Inc.paid its employees $10,000 for work performed in May.The entry to record the payment includes a:
A) credit to Salaries and Wages Expense for $10,000.
B) credit to Cash for $10,000.
C) debit to Cash for $10,000.
D) credit to Salaries and Wages Payable for $10,000.

Question

Quizplus · Accepted Answer

The entry to record the payment of salaries includes a credit to Cash, as cash is being paid out, and a debit to Salaries and Wages Expense. The other options are incorrect: choice A is incorrect because it is a debit that would be recorded at the end of the period to record the expense accrued for that period; choice C is incorrect because it is the opposite of what is actually happening, as cash is being paid out and not received; and choice D is incorrect because it would be recorded when the salaries are accrued, but not when they are paid.

Bank 'N' Roll,Inc