The adjusting entry to record the earned but unpaid salaries of employees at the end of an accounting period is:
A) Debit Unpaid Salaries and credit Salaries Payable.
B) Debit Salaries Payable and credit Salaries Expense.
C) Debit Salaries Expense and credit Cash.
D) Debit Salaries Expense and credit Salaries Payable.
E) Debit Cash and credit Salaries Expense.

Question

Quizplus · Accepted Answer

The adjusting entry to recognize the earned but unpaid salaries of employees is to debit Salaries Expense (increasing the expense for the period) and credit Salaries Payable (recording the liability). Option A is incorrect because Unpaid Salaries is not an account. Option B is incorrect because debiting Salaries Payable would decrease the liability, which is incorrect. Option C is incorrect because you cannot credit cash when no payment has been made yet. Option E is incorrect because it records the payment of salaries, rather than the recognition of the unpaid salaries liability.

The Adjusting Entry to Record the Earned but Unpaid Salaries