Riverbed Inc. provides paid vacations to its employees.

At December 31, 2020, 24 employees have each earned 2 weeks of vacation time.

The employees’ average salary is $690 per week.

Prepare Riverbed’s December 31, 2020, adjusting entry.

Dr Salaries & Wages Expense $33,120

Cr Salaries & Wages Payable $33 120

Explanation:

Riverbed’s December 31, 2020, adjusting entry.

Dr Salaries & Wages Expense $33,120

Cr Salaries & Wages Payable $33 120

(24 employees x 2 weeks x $690 = $33,120)

Dr. Wages Expense  $33,120

Cr. Wages Payable  $33,120

Explanation:

When an Expense is accrued it is recorded with the debit entry and a cash payment or a liability is created against this expense. In this Question the wages expense account is debited and Wages payable account is credited as a liability and it will be adjustment at the time of payments.

As per given Data

Average Salary per week = $690

Vocation Time earned = 2 weeks

Number of Employees = 24 employees

Total Vocation wages expense = $690 x 2 x 24 = $33,120

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