RIZAL CORP. grants its employees 10 days of paid vacation leave per year. Per company's policies, employees are required to take vacation leave each year butnot necessarily to take the whole vacation leave credits each year. Vacation leaves not taken during a year can be carried over indefinitely. RIZAL CORP. has 400employees with an average salary of P800 per day. There is an average increase in salary of 5% every year. During 2018, total leave vacation taken by employeeswere 3,200 days. Based on past experience, 80% of unused vacation leave for a year are taken immediately next year. If the unused vacation leaves do not vest,what amount should be reported as vacation pay expense in 2018?3,097,6003,232,0003,200,0002,560,000O

Vacation pay means the paid leaves provided by the company to its employees. In the vacation pay,…

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what amount should be reported as vacation pay expense in 2018? 3,097,600 3,232,000

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter9: Current Liabilities And Contingent Obligations

Section: Chapter Questions

Problem 6MC

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Question

RIZAL CORP. grants its employees 10 days of paid vacation leave per year. Per company's policies, employees are required to take vacation leave each year but
not necessarily to take the whole vacation leave credits each year. Vacation leaves not taken during a year can be carried over indefinitely. RIZAL CORP. has 400
employees with an average salary of P800 per day. There is an average increase in salary of 5% every year. During 2018, total leave vacation taken by employees
were 3,200 days. Based on past experience, 80% of unused vacation leave for a year are taken immediately next year. If the unused vacation leaves do not vest,
what amount should be reported as vacation pay expense in 2018?
3,097,600
3,232,000
3,200,000
2,560,000
O

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