Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Stellar Company began operations on January 2, 2019. It employs 9 individuals who work 8-hour days and are paid hourly. Each employee earns 10 paid
Stellar Company began operations on January 2, 2019. It employs 9 individuals who work 8-hour days and are paid hourly. Each employee earns 10 paid vacation days and 6 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 Vacation Days Used by Each Employee Sick Days Used by Each Employee 2019 2020 2019 2020 2019 2020 $15 $18 9 4 5 Stellar 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 i 2019 2020 Projected Future Pay Rates Used to Accrue Vacation Pay $13.00 16.00 Date Account Titles and Explanation 2019 Salaries and Wages Expense Salaries and Wages Payable (To accrue the expense and liability for vacations) Salaries and Wages Expense Salaries and Wages Payable (To record sick leave paid) Salaries and Wages Payable Cash (To record vacation time paid) Debit 9360 Credit 936 3744 9360 936 3744 2020 Salaries and Wages Expense Salaries and Wages Payable (To accrue the expense and liability for vacations). Salaries and Wages Expense Salaries and Wages Payable (To record sick leave paid) Salaries and Wages Expense Salaries and Wages Payable Cash (To record vacation time paid) 11520 10368 5760 5760 11520 10366 5760
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started