Chapter 03 – Adjusting Accounts for Financial Statements
Quick Study 3-18 (15 minutes)
a. Step 1: Salaries Payable equals $0
Step 2: Salaries Payable should equal $15,500 (not yet recorded)
Step 3: Adjusting entry to get from Step 1 to Step 2
Salaries Expense ……………………………………………………..
15,500
Salaries Payable …………………………………………………..
15,500
To record employee salaries earned but not yet paid.
b. Step 1: Interest Payable equals $0
Step 2: Interest Payable should equal $250 (not yet recorded)
Step 3: Adjusting entry to get from Step 1 to Step 2
Interest Expense ……………………………………………………...
250
Interest Payable …………………………………………………...
250
To record interest incurred but not yet paid.
c. Step 1: Interest Payable equals $0
Step 2: Interest Payable should equal $875 (not yet recorded)
Step 3: Adjusting entry to get from Step 1 to Step 2
Interest Expense ……………………………………………………...
875
Interest Payable …………………………………………………...
875
To record interest incurred but not yet paid.
