Question

Novak Company began operations on January 2, 2016. It employs 12 individuals who work 8-hour days and are paid hourly. Each employee earns 11 paid vacation days and 8 paid sick days annually. Vacation days may be taken after January 15 of the year tollowing the year in which they are earned, Sick days may be taken as soon as they are c๑med; unused sick days accumulate. Additional information is as follows. Acbul V ction Deys Sick Days Ueed Used by Each S $9 0 Novak Company has chosen to accrue the cost of compensated absences at rates of pay in etfect during the period when earned and to accrue sick pay when earned EYour answer is partially correct. Try again. Prepare journal entries to record transactions related to compensated absences during 2016 and 2017. (If no entry is required, select "No Entry for the account tities and enter O for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Cred t 2015 Salaries and Wages Expense 4 Salaries end W (To accrue the cponse and labiity for vacations) 448 BA44) 七 6.144 nd W 一 Salaries and W able (To accrue the expense and Fabiity for sick pay) Cash 2,880 To record payment for compensated time when used by employees) 2017 Salaries and Wages Expense 9,504 Salaries and Wages Payable To accrue the cxpanse and lability for vacations) 9,504 6,912 and W 6,912 accrue the expense and Tabiity for sck pay) Salaries and Cash To rocord vacation time paid) 8640 and w and w Cash To record sick leave paid) Your answer is incorrect. Try again. Compute the amounts of any liability for compensated abeences that should be reported on the balance sheet at December 31, 2016 and 2017. 2016 2017 Vacation Wages Payable Sick Pay Wages Payable

Answer 1