A company gives each of its 50 employees (assume they were all employed continuously through 2020 and 2021) 12 days of vacation a year if they are employed at the end of the year. The vacation accumulates and may be taken starting January 1 of the next year. The employees work 8 hours per day. In 2020, they made $17.50 per hour and in 2021 they made $20 per hour. During 2021, they took an average of 9 days of vacation each. The company's policy is to record the liability existing at the end of each year at the wage rate for that year. What amount of vacation liability would be reflected on the 2020 and 2021 balance sheets, respectively? Select one: a. $96,000; $120,000 O b. $96,000; $117,000 O c. $84,000; $120,000 O d. $84,000; $117,000
A company gives each of its 50 employees (assume they were all employed continuously through 2020 and 2021) 12 days of vacation a year if they are employed at the end of the year. The vacation accumulates and may be taken starting January 1 of the next year. The employees work 8 hours per day. In 2020, they made $17.50 per hour and in 2021 they made $20 per hour. During 2021, they took an average of 9 days of vacation each. The company's policy is to record the liability existing at the end of each year at the wage rate for that year. What amount of vacation liability would be reflected on the 2020 and 2021 balance sheets, respectively? Select one: a. $96,000; $120,000 O b. $96,000; $117,000 O c. $84,000; $120,000 O d. $84,000; $117,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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
Transcribed Image Text:A company gives each of its 50 employees (assume they were all employed continuously
through 2020 and 2021) 12 days of vacation a year if they are employed at the end of the
year. The vacation accumulates and may be taken starting January 1 of the next year.
The employees work 8 hours per day. In 2020, they made $17.50 per hour and in 2021
they made $20 per hour. During 2021, they took an average of 9 days of vacation each.
The company's policy is to record the liability existing at the end of each year at the
wage rate for that year. What amount of vacation liability would be reflected on the
2020 and 2021 balance sheets, respectively?
Select one:
a. $96,000; $120,000
b. $96,000; $117,000
O c. $84,000; $120,000
O d. $84,000; $117,000
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