Sunland Co. began operations o
Sunland Co. began operations on January 2, 2020. It employs 17people who work 8-hour days. Each employee earns 10 paid vacationdays annually. Vacation days may be taken after January 10 of theyear following the year in which they are earned. The averagehourly wage rate was $20 in 2020 and $21.75 in 2021. The averagevacation days used by each employee in 2021 was 9. Sunland Co.accrues the cost of compensated absences at rates of pay in effectwhen earned.Prepare journal entries to record the transactions related to paidvacation days during 2020 and 2021
Answer:
Given Number of Employees=17 people
Employees Salary=10 vacation day annually
Number of Hours= 8Hours
So average hourly wage rate in 2020= $20
So average hourly wage rate in 2021= $21.75
The average vacation days used by each employee in 2021 was9.days
Following is the Journal Entries related topaid vacation days during 2020 and 2021
| Date | Account Title | Debit($) | Credit($) |
| 2020 | Wages Expenses | $27,200 | |
| Vacation Wages Payable | $27200 | ||
| (17 people*8 hours*10days*20) | |||
| (Recording of the vacation wages in 2020) | |||
| 2021 | Wages Expenses | $2,142 | |
| Vacation Wages Payable (17people*8hours*9days*$20) | $24,480 | ||
| Cash(17 people*8 hours*9 days*21.75) | $26,622 | ||
| (Being cash paid for vacation wages) | |||
| 2021 | Wages Expenses | $29,580 | |
| Vacation Wages Payable | $29,580 | ||
| (17 people*8hours*10days*21.75) | |||
| (Recording of vacation wages due in 2021) |
"Our Prices Start at $11.99. As Our First Client, Use Coupon Code GET15 to claim 15% Discount This Month!!"
