Scenario: Torquay Surf School Ltd has a five-day working week, and a total wages bill of $2500 per week. The wages are paid in arrears (that is, they are paid after the service is provided by the employees) on Friday each week. The end of the financial period (the date on which we need to prepare financial reports) is 30 June, which is a Thursday. Issue: What amount of accrued wages needs to be recognised at the end of the accounting period, and how should it be recognised? Solution: When determining the answers to these questions, consider the following.