Question

Blake Company pays its employees for two weeks vacation each year. The total annual cost of the vacation benefit is $113,000. Prepare the journal entry to record the weekly accrued vacation expense.

Answer 1

Date	Account	Debit	Credit
XXX	Vacation Expense	$       1,13,000
	Vacation Payable		$     1,13,000
	(To record the weekly accrued vacation expense.)

Date Credit Debit $ 1,13,000 XXX Account Vacation Expense Vacation Payable (To record the weekly accrued vacation expense.) $ 1,13,000 To record vacation accrual, you should debit Vacation Expense account and credit Vacation Payable account. Credit Vacation Payable because vacation accrual is considered a liability. When the employee uses vacation days, you should reverse the accrual account with an additional journal entry. That is: Date Credit Debit $ XXX Account Vacation Payable Cash $

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Hope you understood.