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    schoolmeans's Avatar
    schoolmeans Posts: 3, Reputation: 1
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    #1

    Feb 12, 2010, 09:28 PM
    At October 31, Nathan Company made an accrued expense adjusting entry of $1,400
    OK we are doing reversing entries in school I have no clue to I am doing so can anybody help?? Here is the question an info I was given so help please!!
    *BE4-12 At October 31, Nathan Company made an accrued expense adjusting entry of $1,400
    For salaries. Prepare the reversing entry on November 1, and indicate the balances in Salaries
    Payable and Salaries Expense after posting the reversing entry.
    ROLCAM's Avatar
    ROLCAM Posts: 1,420, Reputation: 23
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    #2

    Feb 13, 2010, 04:29 AM

    At the end of an accounting period,
    It is sometimes necessary to put in
    An accrual journal entry.
    This you must have by now are capable to do.
    If YES , than the reversal entry is just a piece of cake.
    You literally reverse the accrual entry.
    The Debit becomes the Credit
    And the Credit becomes the Debit.
    You literally undo the Accrual Entry.
    If you just post the two journal entries on T - accounts, you will find that everything clears to zero.
    morgaine300's Avatar
    morgaine300 Posts: 6,561, Reputation: 276
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    #3

    Feb 15, 2010, 02:44 AM
    Quote Originally Posted by ROLCAM View Post
    If you just post the two journal entries on T - accounts, you will find that everything clears to zero.
    "Everything" doesn't clear to zero. The expense account won't, which is part of how it works. It will have a negative balance in it, representing the portion you reversed. That was the expense from the prior year. At the level you're at, don't worry too much about why this works - if you really want to know I can illustrate it. But just know that you won't end up with a zero balance in the expense.
    ROLCAM's Avatar
    ROLCAM Posts: 1,420, Reputation: 23
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    #4

    Feb 15, 2010, 06:25 PM

    Maybe I did not made my statement clear enough.
    The accrual entry when posted and the reversal entry when posted
    Will contra each other .

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