The following applies to Q 24,25,26,27.28 provides numerous the vacation during

Question

The following applies to Q 24,25,26,27.28 provides numerous the vacation during any summer months ( of employment. Sick pay vests at the completion of flive years of continuous service. are paid from the general fiand semi-monthly on the 1 5th day and the last day of the month. The OC Vested unused sick pay will be paid upor employee benefits. fis. Employees earn ten vacation days for each 12 months of employment. The employee can take prior to retirement. The employees also earm one sick day for each month retirement or termination. The city contributes to a retirement plan that is administered by the state. Each year the city setsa statement from the state explaining the actuarially determined contribution required The OC recognizes revenuesvexpenditures when collected/paid or if collected/paid within 60 days of year-end. The QC's fiscal year vested earned sick leave Assuming that the city maintains its books and records in a manner to facilitate the preparation of fund financial statements, analyze end is Deember 31. At the beginning of the current year employees had S0.4 million of eamed vacation time and S7 million of the financial statement impact for the current year for the following tractions During the year employees of the QC earned $60 million in salaries. At year-end all but $2 million had been paid to the a. employees. OC does plan to pay the rest 61 days after the year end b. During the year the employees of the QC earned $2.5 million in vacation pay. By year end the employes had taken $2 million of vacation. of the balance of vacation pay due to the employees, the QC estimates that $0.3 million will be taken during the next year and S0.2 million will be deferred until later. c. During the year the employees of the QC earned $3 million in sick pay, of which $2.5 million is expected to vest. Of the $2.5 million, employees are expected to take $2.0 million and $0.5 million is expected to be paid to employees upon their termination or retirement. During the year employees took S1 million in sick days. d. The QC received a statement from the state requiring a contribution to the retirement plan of $8 million for the current year. Because of a cash shortage the QC paid $6 million of the required contribution during the year, $1.5 million on February 15 of the following year and S0.5 million in June of the following year. 24. Salary Expenditure should be a $62 million .560 million c.$38 million d. $2 million 25. Total Expenditures-Compensated Absence should be a. $3.0 million b. $2.5 million c. $2.0 milion d. $1.0 million 26. Pension Expenditures should be V?L S8.0 million b. $7.5 million c. $6.0 million d.S1.5 million Total Expense reported on the OC Year End Financial Statement should be a. $73 million 27. b. $71.5 million c. S68 million d. $65 million

Explanation / Answer

An employer should accrue a liability for compensated absences payable to employees for their future absences, but only if all of the following conditions are met:

Correct answer is (b) i.e. 2.5 million

0.5 milliion has been accrued it doesnt mandate to be paid in same year

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