Greetings, Community,

I'm seeking advice on the appropriate journal entries for issuing a Convertible Promissory Note in lieu of an employee's salary deferral. For instance, the employee has postponed $11,000 of their salary from January 1, 2022, to November 30, 2022. On November 30, 2022, the company issued a Convertible Promissory Note amounting to $11,000, with the maturity date set for November 30, 2024.

For each month-end between January 1, 2022, and November 30, 2022, an expense accrual should take place as follows:

Debit: Deferred Compensation Expense $1,000
Credit: Salary Payable $1,000
Upon the issuance of the Convertible Promissory Note on November 30, 2022, the following entries are proposed:

As of November 30, 2022:

Debit: Deferred Compensation Expense $11,000
Credit: Salary Payable $11,000

Debit: Salary Payable $11,000
Credit: Convertible Promissory Note $11,000

Could you confirm if these entries are accurate and full? Additionally, should we account for any taxes?

Thank you.