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Problem - A business provides its employees with varying amounts of vacation per year, depending on the length of employment. The estimated amount of the current year's vacation pay is $61,200.
Required -
a. Journalize the adjusting entry required on January 31, the end of the first month of the current year, to record the accrued vacation pay.
b. How is the vacation pay reported on the company's balance sheet? When is this amount removed from the company's balance sheet?
Sigma Corporation applies overhead cost to jobs on the basis of direct labor cost. Calculate overhead cost to be added to Job W at year-end.
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