At October 31, Nathan Company made an accrued expense adjusting entry of $1,400
for salaries. Prepare the reversing entry on November 1, and indicate the balances in Salaries
Payable and Salaries Expense after posting the reversing entry.
To prepare the reversing entry for the accrued expense of $1,400 for salaries on November 1, you need to reverse the original entry made on October 31.
The original adjusting entry on October 31 would have been as follows:
Debit Salaries Expense: $1,400
Credit Salaries Payable: $1,400
To reverse this entry on November 1, you need to do the opposite:
Credit Salaries Expense: $1,400
Debit Salaries Payable: $1,400
After posting the reversing entry, the balances in Salaries Payable and Salaries Expense would be as follows:
Salaries Expense: The original balance of $1,400 would be reduced by $1,400 (credited) from the reversing entry, resulting in a balance of $0.
Salaries Payable: The original balance of $1,400 would be reduced by $1,400 (debited) from the reversing entry, resulting in a balance of $0.
Therefore, after posting the reversing entry, both Salaries Payable and Salaries Expense would have a balance of $0.