A Company Pays Wages Every Two Weeks

question 67

Multiple Choice

A company pays wages every two weeks. Wages amount to $100 a day. On March 31, the company pays wages for the two weeks ending March 24. At the end of the month, the related adjusting journal entry will include a

• A) debit to Wages Payable for $700 and a credit to Cash for $700.
• B) debit to Wage Expense for $700 and a credit to Wages Payable for $700.
• C) debit to Wages Payable for $700 and a credit to Wages Expense for $700.
• D) debit to Retained Earnings for $700 and a credit to Wages Payable for $700.

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Definitions:

Factor Portfolio

A portfolio constructed to have a high sensitivity to a specific factor or factors, used to capture returns associated with those factors.

Well-Diversified

A portfolio strategy involving the mix of different investments to reduce exposure to risk.

Beta

A scale for determining the level of fluctuation or consistent risk in a security or portfolio compared with the overall market.

Risk Premium

The additional return an investor expects to receive for taking on additional risk compared to a risk-free asset.