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1. • CommentAuthoraccteacher
   • CommentTimeJan 17th 2008

    
   i recently came across an exercise with the following adjustment to final accounts
   
   A christmas bonus of stock has been given to employees costing 1600. the closing stock figure is adjusted, but no other entry has been made in the accounts.
   
   I think I have to reduce the purchases figure and add the 1600 to wages and salaries? would this be right. do I also have to put it into current liabilities?
2. • CommentAuthorgollem57
   • CommentTimeJan 17th 2008

    
   I'm new at this and probably wrong, but issuing stock as a bonus should not affect wages and salaries. I do not see where any other adjustments needs to be made since the closing stock figure was adjusted. Is not everything eventually adjusted to stock?
3. • CommentAuthoraccteacher
   • CommentTimeJan 18th 2008

    
   but there was still cost of 1600 euro to the business and that has not been recorded anywhere. i was thinking again about it and maybe the entry should be to put christmas bonus as an expense in the profit and loss account and put it in as a current liability in the balance sheet?
4. • CommentAuthorgollem57
   • CommentTimeJan 18th 2008

    
   The way I understand it is you do have to add the 1600 to wages and salaries.You would also have to put it in liabilities.
5. • CommentAuthoraccteacher
   • CommentTimeJan 21st 2008

    
   please please please can anyone help me with the above. every teacher i have asked so far is baffled and asked a few accounting friends do doing courses and they never came across an adjustment like it!!
6. • CommentAuthorShamsuddeen
   • CommentTimeFeb 9th 2008

    
   Debit Bonus Expenses Account and Credit Purchase Account