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Athens Company's salaried employees earn two weeks of vacation per year.The company estimated and must expense $6,600 of accrued vacation benefits for the year.Which of the following is the necessary year-end adjusting entry to record accrued vacation benefits?
A) Debit Vacation Benefits Expense $16,500; credit Vacation Benefits Payable $16,500.
B) Debit Vacation Benefits Expense $6,600; credit Vacation Benefits Payable $6,600.
C) Debit Vacation Benefits Expense $17,160; credit Vacation Benefits Payable $17,160.
D) Debit Vacation Benefits Payable $6,600; credit Vacation Benefits Expense $6,600.
E) Debit Vacation Benefits Payable $16,500; credit Vacation Benefits Expense $16,500.
Accrued Vacation Benefits
The amount of vacation time that employees have earned but not yet taken, which is recorded as a liability on the company's books.
Vacation Benefits Expense
The cost to the company for the vacation time entitled to employees, reflected in financial statements.
Year-End Adjusting Entry
Entries made in the accounting records at the conclusion of an accounting period to allocate income and expenditures to the period in which they actually occurred.
- Familiarize oneself with the steps for calculating liabilities and the completion of required journal entries for these estimated liabilities.
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Learning Objectives
- Familiarize oneself with the steps for calculating liabilities and the completion of required journal entries for these estimated liabilities.
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