Concept:Wages owed at the reporting date are outstanding expenses. They appear in the balance sheet as a current liability.
Explanation:On 1/7/07, the trader had an opening liability of Le 2,000 for wages from the previous year.
During the year ended 30/6/08, wages of Le 8,000 were actually paid in cash.
This cash payment would first clear the old unpaid amount of Le 2,000, and the remaining payments relate to wages incurred in the current year.
At 30/6/08, wages of Le 2,400 were still owed and had not yet been paid.
Therefore, the amount to be recorded in the balance sheet as wages owed is the closing liability of Le 2,400.
The Le 8,000 paid is not a balance sheet liability; it is shown in the cash book and in the wages expense account.
The opening liability of Le 2,000 also does not appear on 30/6/08 because it was settled during the year.
Thus, the correct balance sheet figure for wages owed is Le 2,400.
Answer:C. Le 2,400