Portions of the salaries expense account of a business follow:a. Indicate the nature of the entry (payment, adjusting, closing, reversing) from which each numbered posting was made.

Portions of the salaries expense account of a business follow:


Account Salaries Expense Account No. 62 Date Item Post.  Ref. Dr. Cr. 2018 Dec. 27 (1) 29 22,000 1,200,000 31 (2) 30 13,200 1,213,200 31 (3) 31 1,213,200 — — 2019 Jan. 1 (4) 32 13,200 13,200 2 (5) 33 24,000 10,800









a. Indicate the nature of the entry (payment, adjusting, closing, reversing) from which  each numbered posting was made.

b. Journalize the complete entry from which each numbered posting was made. Close revenues and expenses to J. McHenry, Capital.


Answers:

a. (1) Payment (last payday in year)
(2) Adjusting (accrual of wages at end of year)
(3) Closing
(4) Reversing
(5) Payment (first payday in following year)
b. (1) Salaries Expense................................................... 22,000
Cash.................................................................. 22,000
Paid salaries.
(2) Salaries Expense................................................... 13,200
Salaries Payable................................................ 13,200
Accrued salaries.
(3) J. McHenry, Capital................................................ 1,213,200
Salaries Expense................................................ 1,213,200
Closing entry.
(4) Salaries Payable...................................................... 13,200
Salaries Expense................................................ 13,200
Reversing entry.
(5) Salaries Expense................................................... 24,000
Cash.................................................................. 24,000
Paid salaries.