State University, a public university, has a policy of granting faculty members a one-year paid sabbatical leave after a period of seven years continuous employment.The leave is for further study, research or public service.A particular faculty member earns $90,000 per year.Assuming that the college maintains its books and records in a manner that facilitates the preparation of the government-wide financial statements and assuming that any appropriate accruals have been made, what is the appropriate entry to record the employee's salary paid while on sabbatical leave?
A)Debit Expenditures $90,000; Credit Cash $90,000.
B)Debit Expenses $90,000; Credit Cash $90,000.
C)Debit Sabbatical leave payable $90,000; Credit Cash $90,000.
D)No entry required.

Question

Quizplus · Accepted Answer

The salary paid during the sabbatical leave is considered an expense for the university, so it should be recorded as a debit to Expenses and a credit to Cash.

State University, a Public University, Has a Policy of Granting