Under vacation leave cannot be carrled over next year (non-accumulating), What amount should be reported as vacation pay expense In 2019? * 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.

Under vacation leave cannot be carrled over next year (non-accumulating), What amount should be reported as vacation pay expense In 2019? * 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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Rexallo Company begins business on January 2, 2019, with 15 employees. Its company policy is to permit each employee to take 6 days of paid sick leave each year and 1½ days of paid vacation leave for each month worked. The sick leave, if not used, accumulates to a 24-day maximum. The vacation leave accumulates for 2 years, but at any time after a 1-year period, the employee may request additional compensation in lieu of taking paid vacation leave. Rexallo prefers to record the liability for compensated absences on a quarterly basis. Assume that the gross salaries for each employee are $100 per day. The following selected events take place during the first two quarters of 2019: • On March 31, 2019, the quarterly liability for compensated absences is to be recorded. • On April 30, 2019, the following $45,000 monthly payroll, including paid vacation and sick leave, is summarized from Rexallo’s records: Payroll for Time Worked Vacation Taken Sick Leave…
Charlet Company has 35 employees who work 8 hour a day and are paid hourly. On January 1, 2019, the company began a program of granting its employees 10 days paid vacation each year. Vacation days earned in 2019 may first be taken on January 1, 2020. Information relative to these employees is as follows:Year Hourly Wages Vacation Days Earned by EachEmployee Vacation Days Used by EachEmployee2019 P 12.90 10 None2020 13.50 10 82021 14.25 10 10Charlet has chosen to accrue the liability for compensated absences at the current rates of pay in effect when the compensated time is carried. 1. What is the amount of expense relative to compensated absences that should be reported on Charlet’s income statement for 2020? 2. What is the amount of the accrued liability for compensated absences that should be reported at December 31, 2021?
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