Martin Company decided to reward its employees with a bonus of 7% on annual net income, after deducting the bonus. The company reported net income of $513,600 before the calculation of the bonus. Prepare the journal entry to accrue employee bonus expense. Omit explanation.
What will be an ideal response?
Bonus = (Bonus % × Net income before bonus) / (1 + Bonus %)
Bonus = (7% × $513,600) / (1 + 7%) = $33,600
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