Use this information to answer the following question. Panadora Company has the following information for the pay period of January 1-15,2014.Payment occurs on January 20.
The entry to record the payroll would include a
A)debit to Salaries Payable for the net amount.
B)credit to State Unemployment Tax Payable.
C)debit to Salaries Expense for the amount paid to the employees.
D)debit to Salaries Expense for the gross payroll.

Question

Use this information to answer the following question. Panadora Company has the following information for the pay period of January 1-15,2014.Payment occurs on January 20.
 The entry to record the payroll would include a
A)debit to Salaries Payable for the net amount. 
B)credit to State Unemployment Tax Payable. 
C)debit to Salaries Expense for the amount paid to the employees. 
D)debit to Salaries Expense for the gross payroll.

Quizplus · Accepted Answer

The entry to record payroll includes a debit to Salaries Expense for the gross payroll amount because all earned wages are recorded as an expense at the time of payment. The entry also includes credits to various accounts such as Salaries Payable for the net amount, Federal and State Income Tax Withholding Payable, FICA Payable, and any other applicable withholdings or deductions. Option A is incorrect because Salaries Payable is credited for the net amount, not debited. Option B is incorrect because State Unemployment Tax is a liability that is credited when paid.

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