On March 1, 2010, Dillon Company hires a new employee who will start the work on March 6. The employee will be paid on the last day of each month. Should a journal entry be made on March 6? Why or why not? Yes, the company is now obligated to pay the employee, thus that event must be recorded on March 6. No, hiring an employee is an important event; however, it is not an economic event that should be recorded on March Yes, failure to record the event on March 6 would cause the financial statements to be misleading. No, the journal entry should be made on March 1 which is the date of hiring.

On March 1, 2010, Dillon Company hires a new employee who will start the work on March 6. The employee will be paid on the last day of each month. Should a journal entry be made on March 6? Why or why not?

•               Yes, the company is now obligated to pay the employee, thus that event must be recorded on March 6.
•                No, hiring an employee is an important event; however, it is not an economic event that should be recorded on March
•               Yes, failure to record the event on March 6 would cause the financial statements to be misleading.
•               No, the journal entry should be made on March 1 which is the date of hiring.
  

                                        


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