Mohawk Company employs 10 employees and pays each employee $100 per day. Assuming March 31 falls on a Wednesday and all employees are paid each Friday, how much Salaries Expense should be accrued for the March 31 year end?
A) $1,000
B) $400
C) $3,000
D) $0

Question

Quizplus · Accepted Answer

Since March 31 falls on a Wednesday and employees are paid every Friday, there are two days left in the work week (Thursday and Friday) at the end of March. Therefore, the total salaries to be accrued for those two days would be:

10 employees x $100/day x 2 days = $2,000

Since the question is asking for the Salaries Expense to be accrued for the entire month, we need to multiply this amount by the number of weeks in March that the employees worked. Since March has four weeks and the employees were paid every Friday, they would have worked for a total of 8 days (2 days x 4 weeks).

$2,000 x 4 = $8,000

Therefore, the Salaries Expense that should be accrued for the March 31 year end is $3,000.

Mohawk Company Employs 10 Employees and Pays Each Employee $100