The employees of Leicester Services,Inc.worked the last two weeks of December,2016.They received their paychecks on January 2,2017.Which of the following accounts should appear on the income statement for the year ended December 31,2016?

Question

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Salaries Expense should appear on the income statement for the year ended December 31, 2016 because it is a period cost incurred by the company during that year. Prepaid Expense is an asset account that represents expenses paid in advance and would not be recognized as an expense until the related service is received. Salaries Payable is a liability account that represents amounts owed to employees and would not be recognized as an expense until the paychecks are issued. Unearned Revenue is a liability account that represents payments received in advance and would not be recognized as revenue until the related service is performed.

The Employees of Leicester Services,Inc