7. ABC’s employees are entitled to 15-day vacation leaves and 15-day sick leaves every year. At the beginning of 2019, the liability for compensated absences (as presented per books) was for 1,200 days combined vacation and sick leaves forwarded from the previous years, as employees are allowed to carry over unused sick leave and vacation leaves up to two years, upon which any unused leaves re forfeited. In 2018, additional 900 days of unused leaves were forwarded to the subsequent year. From the unused leaves prior to 2019, 450 were used in 2019 and 300 were forfeited. There was a 10% increase in employees’ salaries during the current year. The unadjusted balance of the accrued liability for compensated absences per books reflected the beginning balance of the account. Adjustment for accrual at year-end is yet to be made. The Accrued Compensated Absences account at the beginning of the period is P360,000. What is the correct Accrued Liability from Compensated Absences as of December 31, 2019, a.P405,000 b.P396,000
7. ABC’s employees are entitled to 15-day vacation leaves and 15-day sick leaves every year. At the beginning of 2019, the liability for compensated absences (as presented per books) was for 1,200 days combined vacation and sick leaves forwarded from the previous years, as employees are allowed to carry over unused sick leave and vacation leaves up to two years, upon which any unused leaves re forfeited. In 2018, additional 900 days of unused leaves were forwarded to the subsequent year. From the unused leaves prior to 2019, 450 were used in 2019 and 300 were forfeited. There was a 10% increase in employees’ salaries during the current year. The unadjusted balance of the accrued liability for compensated absences per books reflected the beginning balance of the account. Adjustment for accrual at year-end is yet to be made. The Accrued Compensated Absences account at the beginning of the period is P360,000. What is the correct Accrued Liability from Compensated Absences as of December 31, 2019,
a.P405,000
b.P396,000
c.P360,000
d.P445,500
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