During a recent week, incurred wages were $800. However, $480 of the wages had not been paid. Assume no other adjusting entries have been done this fiscal year. The adjusting entry for wages would be:
A)debit Wages Payable, $480; credit Wages Expense, $480.
B)debit Wages Expense, $480; credit Wages Payable, $480.
C)debit Wages Payable, $320; credit Wages Expense, $320.
D)debit Wages Expense, $320; credit Wages Payable, $320.

Question

Quizplus · Accepted Answer

The adjusting entry should reflect the amount of wages earned but not yet paid as of the end of the fiscal period. Since $480 of the incurred wages had not been paid, the entry should debit Wages Expense for $480 and credit Wages Payable for $480 to reflect the liability for unpaid wages at the end of the period. Therefore, option B is the correct choice.

During a Recent Week, Incurred Wages Were $800