E4-18 LaBamba Company pays salaries of $10,000 every Monday for the preceding 5-day Use reversing entries. week
Question:
E4-18 LaBamba Company pays salaries of $10,000 every Monday for the preceding 5-day Use reversing entries.
week (Monday through Friday). Assume December 31 falls on a Tuesday, so LaBamba’s em- (sq 7)
ployes have worked 2 days without being paid.
Instructions
(a) Assume the company does not use reversing entries. Prepare the December 31 adjusting en¬
try and the entry on Monday, January 6, when LaBamba pays the payroll.
(b) Assume the company does use reversing entries. Prepare the December 31 adjusting entry, the January 1 reversing entry, and the entry on Monday, January 6, when LaBamba pays the payroll.
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Related Book For 
Financial Accounting
ISBN: 9780470128848
6th Edition
Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso
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