A business provides its employees with varying amounts of vacation per year, depending on the length of employment. The estimated amount of the current years vacation pay is $78,600.

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Journalize the adjusting entry required on January 31, the end of the first month of the current year, to record the accrued vacation pay. If an amount box does not require an entry, leave it blank.

blank	Accounts PayableCashSalaries PayableVacation Pay ExpenseVacation Pay Payable	- Select -	- Select -
	Accounts PayableCashSalaries ExpenseVacation Pay ExpenseVacation Pay Payable	- Select -	- Select -

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b. How is the vacation pay reported on the company's balance sheet?

As a current assetAs a current liabilityAs an expenseAs a long-term liability

When is this amount removed from the company's balance sheet?

When employees are paidWhen employees take vacationsWhen the accounting period endsNever