Question
Bear Island Ltd has a weekly payroll of $350,000. The employees receive entitlements to 2 weeks' sick leave per year. The sick-leave entitlements are classified
Bear Island Ltd has a weekly payroll of $350,000. The employees receive entitlements to 2 weeks' sick leave per year. The sick-leave entitlements are classified as non-vesting. Past experience, and experience within the industry, suggest that 50 percent of employees will use their full 2 weeks' entitlement each year; 15 percent of employees will take 1 weeks' sick leave each year, and 15 percent of employees will take 1 day's sick leave each year.
(6 marks)
Required:
a) Calculate the expected annual sick leave expense for Bear Island Ltd (on the basis of average salaries).
Calculations (enter calculation formula) | Total( enter formula results) |
---|---|
Total annual Sick Leave expense |
b) Provide the journal entries necessary each week to recognise the sick-leave entitlement expense as it accrues.
Debit/Credit | Description | Debit Amount | Credit Amount |
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