The Reversing Entry for Salaries Is

question 72

Multiple Choice

The reversing entry for Salaries is

• A) debit Salaries Expense; credit Salaries Payable.
• B) debit Salaries Payable; credit Income Summary.
• C) debit Salaries Payable; credit Salaries Expense.
• D) debit Salaries Expense; credit Cash.

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Definitions:

Break-Even Point

The production level or sales volume at which total revenues equal total costs, resulting in zero profit.

Degree Of Operating Leverage

A financial ratio that measures the sensitivity of a company's operating income to its sales.

Contribution Format

A financial statement format that separates fixed costs from variable costs to highlight the contribution margin of products or services.

Margin of Safety

The difference between actual sales and the break-even point, used to evaluate the level of risk in a business operation.