Western Industries pays employees on a weekly basis on Tuesday for the week ended the previous Friday. Employees' compensation is earned evenly each day over a 5-day work week. This year, April 30 fell on Thursday. Payroll costs for the week ended May 1 follow: Excluding payroll taxes, how much of the accrued payroll at April 30 should be charged to Factory Overhead?

Question

Western Industries pays employees on a weekly basis on Tuesday for the week ended the previous Friday. Employees' compensation is earned evenly each day over a 5-day work week. This year, April 30 fell on Thursday. Payroll costs for the week ended May 1 follow:  Excluding payroll taxes, how much of the accrued payroll at April 30 should be charged to Factory Overhead?

Quizplus · Accepted Answer

If April 30 is Thursday, four days of the payroll fall in April and one in May.
 11eb16ac_e024_8ddd_984d_7f8a04a7eccd_TB6154_00 $17,500 / 5 days = $3,500 per day x 4 days = $14,000

Western Industries Pays Employees on a Weekly Basis on Tuesday