ABC Corp allows each employee to earn 15 days of paid vacation leave per year. Unused vacation leave can be carried up to two years from the year there were earned, thereafter it shall expire. The company has 50 employees (assumed have been employed throughout 2019 and 2020) with an average salary of P900 per day. Salary rates increased by 10% in 2020. According to past experience, 75% of allowed leaves to be carried-forward are ultimately exercised by the employees. Total leave vacation taken by employees during 2019 and 2020 were 400 days and 480 days, respectively.

ABC Corp allows each employee to earn 15 days of paid vacation leave per year. Unused vacation leave can be carried up to two years from the year there were earned, thereafter it shall expire. The company has 50 employees (assumed have been employed throughout 2019 and 2020) with an average salary of P900 per day. Salary rates increased by 10% in 2020. According to past experience, 75% of allowed leaves to be carried-forward are ultimately exercised by the employees. Total leave vacation taken by employees during 2019 and 2020 were 400 days and 480 days, respectively.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Consumer Credit Counseling Services

Credit counseling teaches consumers about credit, budgeting, money management, and debt management. The counselor ensures that consumers can pay off their debts without declaring bankruptcy. Counselors also assist the negotiator, who negotiates with creditors on behalf of their clients to reduce interest rates on outstanding debt. Counselors can offer credit counseling to customers before or after they take on debt. Consumer Credit Counseling Services (CCCS) is a non-profit organization that offers credit counseling services. Some organizations can also be for profit. This type of organization comprises a group of professionals who are skilled negotiators.

Question

Under the assumption: Unused vacation leaves do not vest (accumulating and
non-vesting), What amount should be reported as vacation pay expense in
2020? *
ABC Corp allows each employee to earn 15 days of paid vacation leave per year.
Unused vacation leave can be carried up to two years from the year there were eamed,
thereafter it shall expire. The company has 50 employees (assumed have been
employed throughout 2019 and 2020) with an average salary of P900 per day. Salary
rates increased by 10% in 2020.
According to past experience, 75% of allowed leaves to be carried-forward are
ultimately exercised by the employees. Total leave vacation taken by employees
during 2019 and 2020 were 400 days and 480 days, respectively.
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