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 $63,600 Required a Journalize the adjusting entry required on January 31, the end of the first month of the current year, to record the accrued vacation pay Refer to the Chart of Accounts for exact wording of account titles b How is the vacation pay reported on the companys balance sheet (options current asset, expense, current liability or long term liability, unless employees are allowed to accumulate their vacation pay for use in the future ) When is this amount removed from the companys balance sheet (options when employees take vacation, never, when the accounting period ends or when employees are paid) CHART OF ACCOUNTS General Ledger ASSETS 110 Cash 111 Accounts Receivable 112 Interest Receivable 113 Notes Receivable 115 Inventory 116 Supplies 118 Prepaid Insurance 120 Land 123 Building 124 Accumulated Depreciation Building 125 Office Equipment 126 Accumulated Depreciation Office Equipment LIABILITIES 210 Accounts Payable 213 Interest Payable 214 Notes Payable 215 Salaries Payable 216 Social Security Tax Payable 217 Medicare Tax Payable 218 Employees Federal Income Tax Payable 219 Employees State Income Tax Payable 221 Retirement Savings Deductions Payable 224 Federal Unemployment Tax Payable 225 State Unemployment Tax Payable 226 Vacation Pay Payable 227 Unfunded Pension Liability 228 Product Warranty Payable EQUITY 310 Common Stock 311 Retained Earnings 312 Dividends 313 Income Summary REVENUE 410 Sales 610 Interest Revenue EXPENSES 510 Cost of Goods Sold 520 Salaries Expense 524 Depreciation Expense Building 525 Delivery Expense 526 Repairs Expense 529 Selling Expenses 531 Rent Expense 532 Depreciation Expense Office Equipment 533 Insurance Expense 534 Supplies Expense 535 Payroll Tax Expense 536 Vacation Pay Expense 537 Pension Expense 538 Cash Short and Over 539 Product Warranty Expense 540 Miscellaneous Expense 710 Interest Expense

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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

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 $63,600.

	Required:
	a. Journalize the adjusting entry required on January 31, the end of the first month of the current year, to record the accrued vacation pay. Refer to the Chart of Accounts for exact wording of account titles.*
	b. How is the vacation pay reported on the companys balance sheet? (options: current asset, expense, current liability or long-term liability, unless employees are allowed to accumulate their vacation pay for use in the future) When is this amount removed from the companys balance sheet? (options: when employees take vacation, never, when the accounting period ends or when employees are paid)

Required:

a. Journalize the adjusting entry required on January 31, the end of the first month of the current year, to record the accrued vacation pay. Refer to the Chart of Accounts for exact wording of account titles.*

b. How is the vacation pay reported on the companys balance sheet? (options: current asset, expense, current liability or long-term liability, unless employees are allowed to accumulate their vacation pay for use in the future)

When is this amount removed from the companys balance sheet? (options: when employees take vacation, never, when the accounting period ends or when employees are paid)

CHART OF ACCOUNTS

General Ledger

	ASSETS
110	Cash
111	Accounts Receivable
112	Interest Receivable
113	Notes Receivable
115	Inventory
116	Supplies
118	Prepaid Insurance
120	Land
123	Building
124	Accumulated Depreciation-Building
125	Office Equipment
126	Accumulated Depreciation-Office Equipment

	LIABILITIES
210	Accounts Payable
213	Interest Payable
214	Notes Payable
215	Salaries Payable
216	Social Security Tax Payable
217	Medicare Tax Payable
218	Employees Federal Income Tax Payable
219	Employees State Income Tax Payable
221	Retirement Savings Deductions Payable
224	Federal Unemployment Tax Payable
225	State Unemployment Tax Payable
226	Vacation Pay Payable
227	Unfunded Pension Liability
228	Product Warranty Payable

	EQUITY
310	Common Stock
311	Retained Earnings
312	Dividends
313	Income Summary

	REVENUE
410	Sales
610	Interest Revenue

	EXPENSES
510	Cost of Goods Sold
520	Salaries Expense
524	Depreciation Expense-Building
525	Delivery Expense
526	Repairs Expense
529	Selling Expenses
531	Rent Expense
532	Depreciation Expense-Office Equipment
533	Insurance Expense
534	Supplies Expense
535	Payroll Tax Expense
536	Vacation Pay Expense
537	Pension Expense
538	Cash Short and Over
539	Product Warranty Expense
540	Miscellaneous Expense
710	Interest Expense