5 2 points J had 680000 in its vacation payable account on 1

5. (2 points) J had $680,000 in its vacation payable account on 12-31-14. A detailed analysis of its vacation liability as of 12-31-15 indicated J needed a payable balance of $709,000. During 2015, J accrued for and recorded $721,000 of paid vacation expense. In addition, during 2015 J paid its employees $678,000 for paid vacation time.

a. Prepare J’s 2015 entries related to vacation.

b. What was J’s vacation expense for the year ended 12-31-15?

Solution

A.

Vacation Exp.     Dr       $721000

      To Cash/Bank                      $721000

B.

vacation expense for the year ended 12-31-15 is $750000