Hi please help me on this transaction, because I answer myself as follow: Dr. Salaries Expenses and Cr. Account Payable. But I am not sure with my answer.

Sells a house and lot for M.E. Petty; commissions due from Petty, $10,800 (not paid by Petty at this time).

The information is confusing. WHO is the entry supposed to be for? The person who is going to pay the commission or the person is who going to get the commission?

Quote:

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Originally Posted by raiya

Hi please help me on this transaction, because I answer myself as follow: Dr. Salaries Expenses and Cr. Account Payable. But I am not sure with my answer.

Sells a house and lot for M.E. Petty; commissions due from Petty, $10,800 (not paid by Petty at this time).

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Salaries
Debit Salaries Expense
Credit Salaries Payable

Commission

In this case the agent has earned a commission by selling the property on behalf Petty, hence:

Debit Accounts receivable
Credit Commission revenue