Flagg records adjusting entries at its December 31 year end. At December 31, employees had earned $12,000 of unpaid and unrecorded salaries. The next payday is January 3, at which time $30,000 will be paid. Prepare the January 1 journal entry to reverse the effect of the December 31 salary expense accrual.
A. Debit Salaries payable $12,000, credit Salaries expense $12,000.
B. Debit Salaries expense $18,000; credit Salaries payable $18,000.
C. Debit Salaries expense $12,000; credit Salaries payable $12,000.
D. Debit Salaries expense $18,000; debit Salaries payable $12,000; credit Cash $30,000.
E. Debit Salaries payable $18,000; credit Cash $18,000.
Answer: A
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