Ben Limited has a 31 December year end. Employees work a 5 day week and are entitled to 20 paid working days of vacation per annum.
Employee statistics are as follows:
Number of employees : 50 000
Average annual salary 2017 : 100 000
Unused leave 31 December 2017 : 10 Days
Leave taken in the year ended 31 December 2018 : 14 Days
* S1 and S2 : On average, 9 Earned in 2018, 5 Earned in 2017
* S3 : All earned in 2018
Leave expected to be taken during the year ended 31 December 2019 : 15 Days
* S1 and S2 : On average, 12 Days earned in 2019, 3 Days earned in 2018
* S3 : All days earned in 2019
Additional information :
1. No employees left or joined the company in the past 2 years
2. Salaries increased by 20% from 01 January 2018
3. Past estimates show that management is able to correctly forecast the number of vacation days that will be used in the following financial year.
Required :
Determine the Leave Pay Provision, and Provide the Journal at the 31 December 2018 assuming that :
1.1 Leave accumulates and vests indefinitely
1.2. Leave accumulates for one year after it accrues but is non-vesting
1.3. Leave does not accumulate and is non-vesting
