Danielsen Inc. had salaries payable of $70,000 as of January 1 and $30,000 as of December 31. During the year, Danielsen showed $550,000 in salaries expense on the income statement. Cash outflows for salaries for the year were ________.
A) $510,000
B) $550,000
C) $590,000
D) $620,000

Question

Quizplus · Accepted Answer

To find cash outflows for salaries, adjust the salaries expense by the change in salaries payable: $550,000 (salaries expense) + $70,000 (beginning payable) - $30,000 (ending payable) = $590,000.