At October 31, Nathan Company made an accrued expense adjusting entry of $1,400for salaries. Prepare the reversing entry on November 1, and indicate the balances in Salaries
Payable and Salaries Expense after posting the reversing entry.
Would this answer be right???
Nov. 1 Salaries Payable 1,400
Salaries Expense 1,400
The balances after posting the reversing entry are Salaries Expense (Cr.) $1,400 and Salaries Payable $0.
how do I write this 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
To determine if the answer is correct, we first need to understand the concept of reversing entries and how they affect the balances in Salaries Payable and Salaries Expense.
Reversing entries are made at the beginning of an accounting period to reverse certain adjusting entries made at the end of the previous period. The purpose of reversing entries is to simplify the recording process and ensure accurate financial reporting.
In this case, the accrued expense adjusting entry of $1,400 for salaries was made on October 31. To reverse this entry on November 1, an equal and opposite entry should be made. This means that the Salaries Payable account should be credited with $1,400, while the Salaries Expense account should be debited with the same amount.
Therefore, the correct reversing entry for November 1 would be:
Nov. 1:
Salaries Payable 1,400 (credit)
Salaries Expense 1,400 (debit)
After posting this reversing entry, the balances in Salaries Expense and Salaries Payable would be:
Salaries Expense: $1,400 (debit)
Salaries Payable: $0
Your answer is correct. The balancing figures in both accounts confirm that the reversing entry has been correctly recorded.