Tiff Limited has a 31 December year end. Employees work a 5 day week and are entitled to 20 paidworking days of vacation per annum. Employees statistics are as follows:

Number of employees - 50 000

Average annual salary: 2017 - R100 000

Unused leave 31 December 2017 - 10 days

Leave taken in the year ended 31 December 2018 - 14 days

• S1 &S2 : on average, 9 earned in 2018, 5 earned in 2017
• S3: all earned in 2018

Leave expected to be taken during the year ended 31 December 2019 - 15 days

• S1 & S2: on average, 12 days earned in 2019, 3 days earned in 2018
• S3: all days earned in 2019

Additional information:

1.No employees left or joined the company in the past 2 years.

2.Salaries increased by 20% from 01 January 2018.

3.Past estimates show that management is able to correctly forecast the number of vacation days that will be used in the following financial year.

Required:

Determine the leave pay provision, and provide the journal as at 31 December 2018 assuming that:

3.1.Leave accumulates and vests indefinitely(10 marks)

3.2.Leave accumulates for one year after it accrues but is non-vesting(10 marks)

3.3.Leave does not accumulate and is non-vesting(10 marks)