When a Firm Has Wages Earned but Not Yet Paid

question 57

Multiple Choice

When a firm has wages earned but not yet paid at the end of a financial reporting period,what must it do to recognize the liabilities and expenses?

• A)It must credit the asset accounts for the appropriate payroll amounts.
• B)It must pay its employees for the wages earned as of that date.
• C)It must wait until the next financial period to record the payroll data.
• D)It must create an adjusting entry to recognize the payroll accrual.

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Definitions:

Riboflavin

A B-vitamin (B2) essential for energy production and cellular function, found in foods like milk, meat, and green vegetables.

Coenzyme FAD

A redox-active coenzyme associated with various enzymes and involved in several important metabolic reactions, full name flavin adenine dinucleotide.

Phosphorylated

Refers to a molecule that has been modified by the addition of a phosphate group, often altering its function or activity.

Glucose

A simple sugar and a key energy source for cells, it plays a critical role in cellular respiration and energy metabolism.