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ConeZone Company pays salaries of $20,000 every Monday for the preceding 5-day week (Monday through...

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Question

Accounting

ConeZone Company pays salaries of $20,000 every Monday for the preceding 5-day week (Monday through
Friday). Assume December 31 falls on a Wednesday, so ConeZone's employes have worked three days
without being paid. In addition, ConeZone has earned $3,500 of revenue on account that has not yet been
recorded.
Instructions:
(a) Assume the company does not use reversing entries. Prepare the December 31 adjusting entry for
salaries and the entry on Monday, January 5, when ConeZone pays the payroll.
(b) Assume the company does use reversing entries. Prepare the December 31 adjusting entry for salaries,
the January 1 reversing entry, and the entry on Monday, January 5, when ConeZone pays the payroll.
(c) Assume the company does not use reversing entries. Prepare the December 31 adjusting entry for
service revenue, and the entry on Tuesday, January 6, when ConeZone receives the cash.
(d) Assume the company does use reversing entries. Prepare the December 31 adjusting entry for service
revenue, the January 1 reversing entry, and the entry on Tuesday, January 6, when ConeZone receives
the cash.
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