Each Friday, LarocheLaroche pays employees for the current week's work. The amount of the weekly payroll is $ 7 comma 500$7,500 for a five-day workweek. This year December 31 falls on a WednesdayWednesday. LarocheLaroche will pay its employees on January 22. Journalize the subsequent journal entry that LarocheLaroche will record on January 22.

Debit Accrued expense $4,500

Debit Salaries expense $3,000

Credit Cash account $7,500

Being entries to recognize salaries paid on January 2.

Explanation:

Under the accrual basis of accounting, expenses are recorded when incurred and not necessarily when payment has been made.

The entries required are debit expense and credit accrued expense.

Given that weekly pay is $7,500 for a 5-day week, daily pay

= 1/5 * $7,500

= $1,500

Salaries expense incurred between Monday and Wednesday

= 3 * $1,500

= $4,500

Entries required on December 31

Debit Salaries expense $4,500

Credit Accrued salaries $4,500

On January 2 when the employees are paid, the additional amount to be expensed

= $7,500 - $4,500

= $3,000

Entries to be posted

Debit Accrued expense $4,500

Debit Salaries expense $3,000

Credit Cash account $7,500

Being entries to recognize salaries paid on January 2.