Monsters Inc began operations on January 1, 2017. The company employs 15 monsters whose jobs are to scare little children. They are paid eight-hour days and are paid hourly. Each employee earns 15 paid vacation days and 10 paid sick days annually. Vacation days may be taken immediately. Sick days may be taken as soon as they are earned; unused sick days accumulate. Additional information is as follows:

Actual Hourly Vacation Days Used Sick Days Used

Wage Rate by Each Employee by Each Employee

2017 2018 2017 2018 2017 2018

$10 $11 10 15 6 8

Monsters Inc has chosen to accrue the cost of compensated absences at rates of pay in effect during the period when they are earned and to accrue sick pay when it is earned.

1. Prepare journal entry(ies) to record the transactions related to vacation entitlement during 2017 and 2018.
2. Prepare journal entry(ies) to record the transactions related to sick days during 2017 and 2018.
3. Calculate the amounts of any liability for vacation pay and sick days that should be reported on the balance sheet at December 31, 2017 and 2018.