Ayayai Company began operations on January 2, 2019. It employs 9 individuals who work 8-hour days and are paid hourly. Each employee earns 9 paid vacation days and 7 paid sick days annually. Vacation days may be taken after January 15 of the year following the year in which they are earned. Sick days may be taken as soon as they are earned; unused sick days accumulate. Additional information is as follows.Actual HourlyWage Rate Vacation Days Usedby Each Employee Sick Days Usedby Each Employee2019 2020 2019 2020 2019 2020$6 $7 0 8 5 6Ayayai Company has chosen to accrue the cost of compensated absences at rates of pay in effect during the period when earned and to accrue sick pay when earned. Prepare journal entries to record transactions related to compensated absences during 2019 and 2020. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)I need help with last part. (To record sick leave paid) **Accrual of Expenses and Liabilities for Employee Benefits**1. **To Accrue the Expense and Liability for Vacations:** - **Salaries and Wages Expense** - Debit: $3,528 - **Salaries and Wages Payable** - Credit: $3,5282. **To Accrue the Expense and Liability for Sick Pay:** - **Salaries and Wages Expense** - Debit: $576 - **Salaries and Wages Payable** - Credit: $3,456 - **Cash** - Credit: $4,0323. **To Record Vacation Time Paid:** *(No amounts entered for this section; fields are blank.)*4. **To Record Sick Leave Paid:** *(No amounts entered for this section; fields are blank.)*This entry outlines how to record the expenses and liabilities associated with employee vacations and sick pay, noting the accounts to be debited and credited, along with their respective amounts. The sections for recording vacation time and sick leave paid currently have no amounts recorded, indicating they might be awaiting further transaction details or entries. Sure! Here is the transcription of the accounting entries suitable for an educational context:---**Date: 2019**- **Account Titles and Explanation** - Salaries and Wages Expense - Debit: 3,888 - Salaries and Wages Payable - Credit: 3,888 - *(To accrue the expense and liability for vacations)* - Salaries and Wages Expense - Debit: 3,024 - Salaries and Wages Payable - Credit: 3,024 - *(To accrue the expense and liability for sick pay)* - Salaries and Wages Payable - Debit: 2,160 - Cash - Credit: 2,160 - *(To record payment for compensated time when used by employees)*---**Date: 2020**- **Account Titles and Explanation** - Salaries and Wages Expense - Debit: 4,536 - Salaries and Wages Payable - Credit: 4,536 - *(To accrue the expense and liability for vacations)*---**Explanation**This table represents a series of accounting journal entries for the years 2019 and 2020. The entries record the accruals for salaries and wages related to vacations and sick pay, as well as the payment for compensated time. Each entry shows the accounts affected, with debits listed on the left and credits on the right.

Unused sick leaves accumulate and carryforward to next year Employee sick leave earned= 7 Sick leave…

Answered: Ayayai Company began operations on…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Question

100%

Ayayai Company began operations on January 2, 2019. It employs 9 individuals who work 8-hour days and are paid hourly. Each employee earns 9 paid vacation days and 7 paid sick days annually. Vacation days may be taken after January 15 of the year following the year in which they are earned. Sick days may be taken as soon as they are earned; unused sick days accumulate. Additional information is as follows.

Actual Hourly Wage Rate	Vacation Days Used by Each Employee		Sick Days Used by Each Employee
2019	2020		2019	2020	2019	2020
$6		$7		0	8	5	6

Ayayai Company has chosen to accrue the cost of compensated absences at rates of pay in effect during the period when earned and to accrue sick pay when earned.

Prepare journal entries to record transactions related to compensated absences during 2019 and 2020. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

I need help with last part. (To record sick leave paid)

**Accrual of Expenses and Liabilities for Employee Benefits**

1. **To Accrue the Expense and Liability for Vacations:**

- **Salaries and Wages Expense**
- Debit: $3,528
- **Salaries and Wages Payable**
- Credit: $3,528

2. **To Accrue the Expense and Liability for Sick Pay:**

- **Salaries and Wages Expense**
- Debit: $576
- **Salaries and Wages Payable**
- Credit: $3,456
- **Cash**
- Credit: $4,032

3. **To Record Vacation Time Paid:**

*(No amounts entered for this section; fields are blank.)*

4. **To Record Sick Leave Paid:**

*(No amounts entered for this section; fields are blank.)*

This entry outlines how to record the expenses and liabilities associated with employee vacations and sick pay, noting the accounts to be debited and credited, along with their respective amounts. The sections for recording vacation time and sick leave paid currently have no amounts recorded, indicating they might be awaiting further transaction details or entries.

Sure! Here is the transcription of the accounting entries suitable for an educational context:

---

**Date: 2019**

- **Account Titles and Explanation**
- Salaries and Wages Expense
- Debit: 3,888
- Salaries and Wages Payable
- Credit: 3,888
- *(To accrue the expense and liability for vacations)*

- Salaries and Wages Expense
- Debit: 3,024
- Salaries and Wages Payable
- Credit: 3,024
- *(To accrue the expense and liability for sick pay)*

- Salaries and Wages Payable
- Debit: 2,160
- Cash
- Credit: 2,160
- *(To record payment for compensated time when used by employees)*

---

**Date: 2020**

- **Account Titles and Explanation**
- Salaries and Wages Expense
- Debit: 4,536
- Salaries and Wages Payable
- Credit: 4,536
- *(To accrue the expense and liability for vacations)*

---

**Explanation**

This table represents a series of accounting journal entries for the years 2019 and 2020. The entries record the accruals for salaries and wages related to vacations and sick pay, as well as the payment for compensated time. Each entry shows the accounts affected, with debits listed on the left and credits on the right.

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.