Question

provides its employees two weeks of paid vacation per year. As of December 31, 70 employees have earned two weeks of vacation time to be taken the following year. If the average weekly salary for these employees is $890, what is the required journal entry to accrue compensated absences?

Answer 1

Answer and Explanation:

The journal entry is shown below:

Salary and Wages Expense Dr. $124,600 (70 employees × 2 weeks × $890)

To Salaries and wages payable $124,600

(Being the compensation absences accrued)

For recording this we debited the salary and wages expense and credited the salaries and wages payable as it increased the expenses and liabilities.