Q4. Liability (14 marks) At June 30, 2021, Heroes Co. had the employees with the following annual salaries and weeks leave outstanding: Employee Annual Salary Weeks Leave Outstanding Bob Keane 117,000 Jo Hamilton 83,200 2.5 Niel Carpenter 78,000 1.5 Alex Jane 65,000 3 4 Note: i. If you believe no journal entry is required, explain the reason(s). ii. Narrations are not required for journal entries. iii. Heroes Co.'s chart of accounts includes these accounts - Cash at bank, Accounts Receivable, Inventory, Equipment, Accumulated depreciation, Accounts payable, Salaries payable, Annual Leave Payable, Employees' income tax payable, Employees' medical insurance payable, Employees' superannuation payable, Sales Revenue, Depreciation expense, Salaries expense, Annual leave expense, Proceeds on sale of equipment, Carrying amount of equipment. Required: (A) Assume the beginning balance of Annual Leave Payable account was $11,500, prepare the adjusting journal entries to record the appropriate balance in the Annual Leave Payable account. (4 marks) (B) Assume Employees' superannuation contribution is 12% of their gross fortnightly salary and PAYG tax is taken out at 30% after subtracting the superannuation. All employees also have the 10% deduction from after-tax salaries for medical insurance. Please prepare journal entries to accrue the fortnightly payroll and associated deductions on 30 June 2021. (10 marks) Q4. Liability (14 marks) At June 30, 2021, Heroes Co. had the employees with the following annual salaries and weeks leave outstanding: Employee Annual Salary Weeks Leave Outstanding Bob Keane 117,000 Jo Hamilton 83,200 2.5 Niel Carpenter 78,000 1.5 Alex Jane 65,000 3 4 Note: i. If you believe no journal entry is required, explain the reason(s). ii. Narrations are not required for journal entries. iii. Heroes Co.'s chart of accounts includes these accounts - Cash at bank, Accounts Receivable, Inventory, Equipment, Accumulated depreciation, Accounts payable, Salaries payable, Annual Leave Payable, Employees' income tax payable, Employees' medical insurance payable, Employees' superannuation payable, Sales Revenue, Depreciation expense, Salaries expense, Annual leave expense, Proceeds on sale of equipment, Carrying amount of equipment. Required: (A) Assume the beginning balance of Annual Leave Payable account was $11,500, prepare the adjusting journal entries to record the appropriate balance in the Annual Leave Payable account. (4 marks) (B) Assume Employees' superannuation contribution is 12% of their gross fortnightly salary and PAYG tax is taken out at 30% after subtracting the superannuation. All employees also have the 10% deduction from after-tax salaries for medical insurance. Please prepare journal entries to accrue the fortnightly payroll and associated deductions on 30 June 2021. (10 marks)
