Exercise 2-21 (Algo) Reversing entries [Appendix 2B]

The employees of Xitrex, Inc., are paid each Friday. The companys fiscal year-end is June 30, which falls on a Wednesday for the current year. Salaries are earned evenly throughout the five-day work week, and $18,000 will be paid on Friday, July 2.

Required:

1. Prepare an adjusting entry to record the accrued salaries as of June 30, a reversing entry on July 1, and an entry to record the payment of salaries on July 2.

2. Prepare journal entries to record the accrued salaries as of June 30 and the payment of salaries on July 2 assuming a reversing entry is not recorded.