Coastal Ltd employs its staff on a five-day work week, with employees being paid on Fridays. The
Fantastic news! We've Found the answer you've been seeking!
Question:
Coastal Ltd employs its staff on a five-day work week, with employees being paid on Fridays. The weekly salaries expense is $20 000, and employees are paid in arrears. That is, when the employees are paid, the salaries paid are for work performed in the preceding week. Thruster Ltd retains $4000 per week to pay the Australian Taxation Office for PAYG tax on behalf of the employees. This is paid on the following Monday of each week. It also retains $700 per week to pay staff premiums to the Oceanic Medical Benefits Fund.
If we assume that the reporting date falls on a Thursday, what would the accounting entry at reporting date be to recognise four days’ salary and wages expense?
Expert Answer:
Since the reporting date falls on a Thursday you need to account for four days of the week... View the full answer
Posted Date:
