Degon Corporation opened on January 1, 2025. It employs 20 people who work 8-hour days. Each employee

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Question:

Degon Corporation opened on January 1, 2025. It employs 20 people who work 8-hour days. Each employee earns 10 paid vacation days annually. The average hourly wage rate was $25.00 in 2025 and $26 in 2026. The average vacation days used by each employee in 2026 was 10.

Required:

Prepare journal entries to record the transactions related to paid vacation days and estimated liabilities during 2025 and 2026.