Question

When an employee takes a paid​ vacation, the Vacation Benefits Payable account will be decreased with a credit.

(A) True
(B) False

Answer 1

(B) False

Step-by-step explanation:

The Vacation Benefits payable account represents a liability that the employer has with the employee that has already earned its days of paid vacations but has not used them yet. When the employee is going to enjoy paid vacations days, this account (as all liability accounts) is decreased through a debit, and the bank's account is credited.