Recording and Reporting Compensated Absences Ulta Inc. allows each employee to earn 15 paid vacation days each year with full pay. Unused vacation time can be carried over to the next year. If not taken during the next year, unused vacation time is lost. By the end of 2020, all but 3 of the 30 employees had taken their earned vacation time. The three employees carried over to 2021 a total of 20 vacation days, which represented 2020 salary of $9,600. During 2021, all of these three used their 2020 vacation carryover, none of them had received a pay rate change from 2020 until the time they used their carryover. Total cash wages paid: 2020, $1,120,000; 2021, $1,184,000. There was no carryover of vacation time earned in 2021. a. Provide the entry for Ulta Inc. to accrue compensated absences on December 31, 2020, and for the payment of vacation days in 2021. Disregard payroll taxes. Date Account Name Dr. Dec 31, 2020 Salaries Expense 9,600 Accrued Compensation 9,600 2021 Accrued Compensation 9,600 Cash 9,600 b. Compute the total amount of salaries expense for 2020 and 2021. How would the vacation time carried over from 2020 affect the December 31, 2020 balance sheet? Salaries expense for 2020 $ 1,120,000 x Salaries expense for 2021 $ 1,193,600 x 2020 Balance Sheet, Dec. 31 Current liabilities Accrued Compensation $ 9,600