The correct amount of revenue and expenses are allocated to each accounting period using an adjusting entry.
The correct amount of revenue and expenses are allocated to each accounting period using an adjusting entry. Previously recorded journal entries are updated, ensuring that the financial statements at the end of the year are correct and current.
Examples of expenses that are typically billed at a later time after they have been incurred include utility bills, salaries, and taxes. To delete the account payable that was previously recorded together with the accumulated expense, an adjusting entry is created once the cash is paid.
In order to make adjustments to a company's financial accounts and bring them into accordance with applicable accounting rules, such as generally accepted accounting principles (GAAP) or International Financial Reporting Standards, adjusting journal entries are utilized (IFRS).
The complete question is:
Anika Wilson earned a salary of $400 for the last week of September. She will be paid on October 1. The adjusting entry for Anika's employer at September 30 is:
(a) No entry is required.
(b) Salaries and Wages Expense (debit) 400 & Salaries and Wages Payable (credit) 400.
(c) Salaries and Wages Expense (debit) 400 & Cash (credit) 400.
(d) Salaries and Wages Payable (debit) 400 & Cash (credit) 400.
Therefore, the correct answer is option (b) Salaries and Wages Expense (debit) 400 & Salaries and Wages Payable (credit) 400.
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