XYZ Corp introduced a new compensation plan beginning January 1, 2018. It gave each of its 50 employees 12 days of vacation provided they were employed at the end of the year. All 50 employees worked the full year during 2018 and 2019. The vacation days so granted in a given year could be taken starting January 1 of the following year and these could be accumulated.

Employees work 8 hours per day and 5 days per week. In 2018, they made $17.50 per hour and in 2019 they made $20 per hour. During 2019, they took an average of 9 days of vacation each. The company's policy is to pay all vacation days taken in any given year at the rate prevailing for that year. Further, the the liability existing for the remaining vacation days not taken at the end of any year is valued at the original rate existing in the year when such vacation days had been granted.

Prepare the journal entry in the books of XYZ to record the payment made by the company for the vacation days taken in 2019.

a.

Vacation Wages Expense ........ DR $63,000; Vacation Wages Payable ........ CR $63,000

b.

Salaries and Wages Expense ........ DR $63,000; Cash ........ CR $63,000

c.

Retained Earnings ........ DR $63,000; Vacation Wages Payable ........ CR $63,000

d.

Salaries and Wages Expense ........ DR $9,000; Vacation Wages Payable ........ DR $63,000; Cash ........ CR $72,000

e.

None of the above entries but some other entry.