Salary Expense And Salary Payable

Solution for 3 000 salaries and wages payable salaries and wages expense ilties expense squipment accounts payable service revenue 2 980 45 700 21 100. Now remember when salaries accrue there is no cash exchange that actually takes place and therefore you don t see cash in the journal entry.

Basics Of Accounting Chart Of Accounts General Journal General Led Chart Of Accounts General Ledger Accounting

Salary payable example 1.

Salary expense and salary payable. Darshita 6 14k october 19 2016 0 comments. A current liability is one that the company must pay within one year. Vanilla bond private limited company incorporated in the us has just started the business of brokerage with equity capital of 1 5 million.

Under the accrual method of accounting the account salaries expense reports the salaries that employees have earned during the period indicated in the heading of the income statement whether or not the company has yet paid the employees. Record the employee salary expense withholdings and salaries payable 2 record the employer provided fringe benefits. Wages expense is an expense account whereas wages payable is a current liability account.

1 72k views october 19 2016. Enter the gross payroll amount salary expense in the debit left column. The difference between salaries payable and salaries expense is that the expense encompasses the full amount of salary based compensation paid during a reporting period while salaries payable only encompasses any salaries not yet paid as of the end of a reporting period.

The primary difference between wages expense and wages payable lies in the type of accounts that they are. Thus the amount of salaries payable is usually much lower than the amount of salaries expense. Salaries payable is a out standing expenses for time being its show as a liability account.

Examples of salary payable journal entries. In short the difference between salary expense and salary payable is that the salary expense is the total expense for the period while the salary payable is only the amount of remuneration that is due. Starting on the next line on one line each enter a payable account in the description column and the amount deducted.

The following are examples of salary payable. It has recently hired regina as an accountant to the firm. Since salaries are an expense the salary expense is debited.

Correspondingly salaries payable are a liability and is credited on the books of the company.

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