Answer:
2019
Dr Salaries and wages expense 9,680
Cr Salaries and wages payable 9,680
Dr Salaries and wages expense 6,160
Cr Salaries and wages payable 6,160
Dr Salaries and Wages Payable 3,520
Cr Cash 3,520
2020
Dr Salaries and wages expense 10,560
Cr Salaries and wages payable 10,560
Dr Salaries and wages expense 6,720
Cr Salaries and wages payable 6,720
Dr Salaries and wages expense
800
Dr Salaries and wages payable 8,800
Cr Cash 9,600
Dr Salaries and Wages Expense 240
Dr Salaries and Wages Payable 5,520
Cr Cash 5,760
B. 2019 $10,410
2020 $12,175
Explanation:
(a) Preparation of journal entries to record transactions related to compensated absences during 2019 and 2020
2019
Dr Salaries and wages expense 9,680
Cr Salaries and wages payable 9,680
(10 employees * $11.00/hr. * 8 hrs./day * 11 days)
(Being to record accrue expense and liability for vacation)
Dr Salaries and wages expense 6,160
(10 employees * $11.00/hr. * 8 hrs./day * 7days)
Cr Salaries and wages payable 6,160
(Being to record accrue expense and liability for sick pay)
Dr Salaries and Wages Payable 3,520
Cr Cash 3,520
(10 employees * $11.00/hr. * 8 hrs./day*4 days)
2020
Dr Salaries and wages expense 10,560
(10 employees * $12/.00/hr. * 8 hrs./day * 11 days)
Cr Salaries and wages payable 10,560
(Being to accrue expense and liability for vacation)
Dr Salaries and wages expense 6,720
Cr Salaries and wages payable 6,720
(10 employees * $12.00/hr. * 8 hrs./day * 7 days)
(Being to record accrue expense and liability for sick pay)
Dr Salaries and wages expense
800
(9,600-800)
Dr Salaries and wages payable 8,800
(10 employees * $11.00/hr. X 8 hrs./day *10days)
Cr Cash 9,600
(10 employees * $12.00/hr. * 8 hrs./day X 10days)
(Being to record vacation time period))
Dr Salaries and Wages Expense 240
(10 employees * ($11-12) /hr. * 8 hrs./day * (7-4) last yr)
Dr Salaries and Wages Payable 5,520
(10 employees * $11.00/hr. * 8 hrs./day * (7-4) days) + (10 employees * $12.00/hr. * 8 hrs./day *(6-3) days)
=(2,640+2,880=5520)
Cr Cash 5,760
(10 employees * $12.00/hr. * 8 hrs./day * 6 days)
(Being to record sick leave paid)
B) Computation for the amounts of any liability for compensated absences that should be reported on the balance sheet at December 31, 2019, and 2020
1. December 31, 2019
10 employees * $11.83/hr. * 8 hrs./day * 11 days =$10,410
2. December 31, 2020
10 employees * $11.83/hr. * 8 hrs./day * 1 day =$946
Add: 10 employees * $12.76/hr. * 8 hrs./day * 11 days = 11,229
Total $12,175
($11,229+$946)
Therefore the amounts of any liability for compensated absences that should be reported on the balance sheet at December 31, 2019 will be $10,410 and 2020 will be $12,175
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