Data for an adjusting entry described as "accrued wages, $2,020" would result in
A) a debit to Wages Expense and a credit to Wages Payable
B) a debit to Wages Payable and a credit to Wages Expense
C) a debit to Accounts Receivable and a credit Wages Expense
D) a debit to Dividends and a credit to Wages Payable

Question

Quizplus · Accepted Answer

Accrued wages means that employees have earned wages but they have not yet been paid. This requires a journal entry to recognize the expense and the liability. The debit is to Wages Expense (an income statement account) to recognize the expense and the credit is to Wages Payable (a current liability account) to recognize the liability to pay the employees in the future.

Data for an Adjusting Entry Described as "Accrued Wages, $2,020