Transaction and Adjustment Data for Ortiz Company for the Calendar

question 134

Essay

Transaction and adjustment data for Ortiz Company for the calendar year end is as follows:
1. December 24 (initial salary entry): $15000 of salaries earned between December 1 and December 24 are paid.
2. December 31 (adjusting entry): Salaries earned between December 25 and December 31 are $4500. These will be paid in the January 8 payroll.
3. January 8 (subsequent salary entry): Total salary payroll amounting to $7000 was paid.
Instructions
Prepare two sets of journal entries as specified below. The first set of journal entries should assume that the company does not use reversing entries and the second set should assume that reversing entries are utilized by the company.

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Definitions:

Commission

A fee paid to an agent or employee for transacting a piece of business or performing a service, typically a percentage of the money received from the transaction.

Par Value

The face value of a bond or stock as stated by the issuer, which may differ from its market value.

Dividend Paid

Dividend Paid signifies the actual distribution of a company's earnings to its shareholders in the form of cash, checks, or electronic transfers.

Commission Charges

Fees paid to brokers or agents for their services in facilitating transactions, typically a percentage of the transaction value.