Goldwing Corporation offers enriched parental benefits to its staff. While the government provides compensation based on Employment Insurance legislation for a period of 12 months, Goldwing increases the amounts received and extends the period of compensation. The benefit program tops up the amount received to 100% of the employee’s salary for the first 12 months, and pays employees 75% of their full salary for another six months after the EI payments have stopped.

Zeinab Jolan, who earns $54,000 per year, announced to her manager in early June 2023 that she was expecting a baby in mid-November. On October 29, 2023, nine weeks before the end of the calendar year and Goldwing’s fiscal year, Zeinab applied for and began her 18-month maternity leave. Assume that the Employment Insurance program pays her a maximum of $720 per week for 52 weeks.

For the purpose of this question, ignore any tax, CPP, and EI deductions when making payments to Zeinab.

Instructions

Round all answers to the nearest dollar.

a. Prepare all entries that Goldwing must make during its 2023 fiscal year related to the parental benefits plan in regard to Zeinab. Include the date of each entry.

b. Prepare one entry to summarize all entries that Goldwing will make in 2024 relative to Zeinab’s leave.

c. Calculate the amount of parental benefits payable at December 31, 2023 and 2024. Explain how these amounts will be shown on Goldwing’s SFP.