Question

If a company recorded accrued salaries expense of $500 at the end of its fiscal year, what reversing entry could be made? When would it be made?

Short answer

Answer:

Salaries payable debited and salaries expense credited entry by $500 is made at the beginning of the next fiscal year.

Step-by-step solution

Definition of accrued salaries

Accrued salaries are those salaries that are due, but this payment has still not been made.

Reversing Entry Accrues salaries expense

Date	Particulars	Debit	Credit
	Salaries Payable	$500
	Salaries Expense		$500
	(Being reversal entry passes)

Reversal entries are made at the beginning of the next accounting year. The accountant does this to ensure that accrued salaries are not remain accrued for another year.