Pearl Company began operations on January 2, 2019. It employs 11 individuals who work 8-hour days and are paid hourly. Each employee earns 9 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
$10			$11			0		8		4		5

Pearl Company has chosen to accrue the cost of compensated absences at rates of pay in effect during the period when earned and to accrue sick pay when earned.

(b)

Compute the amounts of any liability for compensated absences that should be reported on the balance sheet at December 31, 2019 and 2020.

		2019		2020
Vacation Wages Payable		$enter a dollar amount		$enter a dollar amount
Sick Pay Wages Payable		$enter a dollar amount

Answer rating: 100% (QA)

2019 Vacation Wages Payable Since vacation days may be taken after January 15 of the year ... View the full answer