The Adjusting Entry at the End of an Accounting Period

question 23

Multiple Choice

The adjusting entry at the end of an accounting period to record the unpaid salaries of employees for work provided is:

• A) Debit Salaries Payable and credit Salaries Expense.
• B) Debit Unpaid Salaries and credit Salaries Payable.
• C) Debit Cash and credit Salaries Expense.
• D) Debit Salaries Expense and credit Salaries Payable.
• E) Debit Salaries Expense and credit Cash.

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Definitions:

Terms of Sale

The conditions under which a sale is made primarily with respect to payment. Terms include a date on which payment is due and often specify a prompt payment discount that may be taken if payment is made within a specified time.

Lock Box Systems

A service provided by banks to companies for the quick collection of payments from customers by directing those payments to a special post office box.

Float Management

The practice of managing the time difference between issuing and clearing checks to optimize the available cash flow.

Lock Box Systems

A service offered by banks to companies for the receipt of payment from customers, involving the collection of payments in regional post office boxes and processing them quickly.