Monty Company began operations on January 2, 2019. It employs 9 individuals who work 8-hour days and are paid hourly. Each employee earns 10 paid vacation days and 6 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 $10 $11 0 9 4 5 Monty Company has chosen not to accrue paid sick leave until used, and has chosen to accrue vacation time at expected future rates of pay without discounting. The company used the following projected rates to accrue vacation time. Year in Which Vacation Time Was Earned Projected Future Pay Rates Used to Accrue Vacation Pay 2019 $10.97 2020 11.83 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. Round answers to 0 decimal places, e.g. 5,125.) Date Account Titles and Explanation Debit Credit 2019 enter an account title to accrue the expense and liability for vacations enter a debit amount enter a credit amount enter an account title to accrue the expense and liability for vacations enter a debit amount enter a credit amount (To accrue the expense and liability for vacations) enter an account title to record sick leave paid enter a debit amount enter a credit amount enter an account title to record sick leave paid enter a debit amount enter a credit amount (To record sick leave paid) enter an account title to record vacation time paid enter a debit amount enter a credit amount enter an account title to record vacation time paid enter a debit amount enter a credit amount (To record vacation time paid) 2020 enter an account title to accrue the expense and liability for vacations enter a debit amount enter a credit amount enter an account title to accrue the expense and liability for vacations enter a debit amount enter a credit amount (To accrue the expense and liability for vacations) enter an account title to record sick leave paid enter a debit amount enter a credit amount enter an account title to record sick leave paid enter a debit amount enter a credit amount (To record sick leave paid) enter an account title to record vacation time paid enter a debit amount enter a credit amount enter an account title to record vacation time paid enter a debit amount enter a credit amount enter an account title to record vacation time paid enter a debit amount enter a credit amount (To record vacation time paid) LINK TO TEXT Compute the amounts of any liability for compensated absences that should be reported on the balance sheet at December 31, 2019 and 2020. (Round answers to 0 decimal places, e.g. 5,125.) 2019 2020 Accrued liability $enter a dollar amount rounded to 0 decimal places $enter a dollar amount rounded to 0 decimal places

Monty Company began operations on January 2, 2019. It employs 9 individuals who work 8-hour days and are paid hourly. Each employee earns 10 paid vacation days and 6 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 $10 $11 0 9 4 5 Monty Company has chosen not to accrue paid sick leave until used, and has chosen to accrue vacation time at expected future rates of pay without discounting. The company used the following projected rates to accrue vacation time. Year in Which Vacation Time Was Earned Projected Future Pay Rates Used to Accrue Vacation Pay 2019 $10.97 2020 11.83 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. Round answers to 0 decimal places, e.g. 5,125.) Date Account Titles and Explanation Debit Credit 2019 enter an account title to accrue the expense and liability for vacations enter a debit amount enter a credit amount enter an account title to accrue the expense and liability for vacations enter a debit amount enter a credit amount (To accrue the expense and liability for vacations) enter an account title to record sick leave paid enter a debit amount enter a credit amount enter an account title to record sick leave paid enter a debit amount enter a credit amount (To record sick leave paid) enter an account title to record vacation time paid enter a debit amount enter a credit amount enter an account title to record vacation time paid enter a debit amount enter a credit amount (To record vacation time paid) 2020 enter an account title to accrue the expense and liability for vacations enter a debit amount enter a credit amount enter an account title to accrue the expense and liability for vacations enter a debit amount enter a credit amount (To accrue the expense and liability for vacations) enter an account title to record sick leave paid enter a debit amount enter a credit amount enter an account title to record sick leave paid enter a debit amount enter a credit amount (To record sick leave paid) enter an account title to record vacation time paid enter a debit amount enter a credit amount enter an account title to record vacation time paid enter a debit amount enter a credit amount enter an account title to record vacation time paid enter a debit amount enter a credit amount (To record vacation time paid) LINK TO TEXT Compute the amounts of any liability for compensated absences that should be reported on the balance sheet at December 31, 2019 and 2020. (Round answers to 0 decimal places, e.g. 5,125.) 2019 2020 Accrued liability $enter a dollar amount rounded to 0 decimal places $enter a dollar amount rounded to 0 decimal places

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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Actual Hourly Wage Rate	Vacation Days Used by Each Employee		Sick Days Used by Each Employee
2019	2020		2019	2020	2019	2020
$10		$11		0	9	4	5

Monty Company has chosen not to accrue paid sick leave until used, and has chosen to accrue vacation time at expected future rates of pay without discounting. The company used the following projected rates to accrue vacation time.

Year in Which Vacation Time Was Earned		Projected Future Pay Rates Used to Accrue Vacation Pay
2019		$10.97
2020		11.83

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. Round answers to 0 decimal places, e.g. 5,125.)

Date	Account Titles and Explanation	Debit	Credit
2019	enter an account title to accrue the expense and liability for vacations	enter a debit amount	enter a credit amount
	enter an account title to accrue the expense and liability for vacations	enter a debit amount	enter a credit amount
	(To accrue the expense and liability for vacations)
	enter an account title to record sick leave paid	enter a debit amount	enter a credit amount
	enter an account title to record sick leave paid	enter a debit amount	enter a credit amount
	(To record sick leave paid)
	enter an account title to record vacation time paid	enter a debit amount	enter a credit amount
	enter an account title to record vacation time paid	enter a debit amount	enter a credit amount
	(To record vacation time paid)
2020	enter an account title to accrue the expense and liability for vacations	enter a debit amount	enter a credit amount
	enter an account title to accrue the expense and liability for vacations	enter a debit amount	enter a credit amount
	(To accrue the expense and liability for vacations)
	enter an account title to record sick leave paid	enter a debit amount	enter a credit amount
	enter an account title to record sick leave paid	enter a debit amount	enter a credit amount
	(To record sick leave paid)
	enter an account title to record vacation time paid	enter a debit amount	enter a credit amount
	enter an account title to record vacation time paid	enter a debit amount	enter a credit amount
	enter an account title to record vacation time paid	enter a debit amount	enter a credit amount
	(To record vacation time paid)

LINK TO TEXT

Compute the amounts of any liability for compensated absences that should be reported on the balance sheet at December 31, 2019 and 2020. (Round answers to 0 decimal places, e.g. 5,125.)

		2019		2020
Accrued liability		$enter a dollar amount rounded to 0 decimal places		$enter a dollar amount rounded to 0 decimal places

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

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