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Australia Ltd has 50 employees. Their wages are $133 per day. Their benefits for sick leave are 10 days paid leave per annum, accumulating and non-vesting. Sick leave is taken first out of the current years entitlement and then out of any balance brought forward from the previous year (a last in first out basis). The balance of unused entitlements at 30 June 2019 was nil. During the year ended 30 June 2020, 220 days of paid sick leave were taken by employees. It is estimated that 50% of unused sick leave will be taken in the future.
Required:
Problem 1: Provide the balance of the Provision for Sick Leave account in the financial statements of Australia Ltd for the year ended 30 June 2020.
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