Answer and Explanation:
The journal entries are shown below:
a. Vacation and Holidays expenses Dr. $45,000
To vacation and Holidays payable $45,000
(Being the Vacation pay is recorded)
For recording this we debited the vacation and holidays expense as it increase the expenses and credited the vacation & holidays payable as it also increase the liabilities
b. Pension Expense Dr. $28,000 ($400,000 × 7%)
To Pension Liability $28,000
(Being the pension benefit is recorded)
For recording this we debited the pension expense as it increase the expenses and credited the pension liability as it also increase the liabilities
