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2. (5 points) Pearl Company began operations on January 2, 2020. It employs 14 individuals who work 8-hour days and are paid hourly. Each employee earns 10 paid vacation days and 5 paid sick days annually. Vacation days may be taken after January 15 of the year following the year in which they are earned. Sick days may be taken as soon as they are earned; unused sick days accumulate. Additional information is as follows. Actual Hourly Wage Rate 2020 2021 Vacation Days Used by Each Employee Sick Days Used by Each Employee 2020 2021 2020 2021 $14.45 $15.85 0 9 3 4 Pearl Company has chosen not to accrue paid sick leave until used, and has chosen to accrue vacation time at expected future rates of pay without discounting. The company used the following projected rates to accrue vacation time. Year In Which Vacation Time Was Earned Projected Future Pay Rates Used to Accrue Vacation Pay 2020 2021 $15.25 $16.20 a. Prepare journal entries to record transactions related to compensated absences during 2020 and 2021. 2020: 1. To accrue expense and liability for vacations 2. To record sick leave paid Accounts DR CR Date 1. 2. a. Prepare journal entries to record transactions related to compensated absences during 2020 and 2021. 2020: 1. To accrue expense and liability for vacations 2. To record sick leave paid Date Accounts DR CR 1. 2021: 1. To accrue expense and liability for vacations 2. To record sick leave paid 3. To record vacation time paid Accounts DR 2. Date 1. 2. 3. CR