Vacation pay and pension benefits
1. Obj. 4
Fukushima Company provides its employees with vacation benefits and a defined contribution pension plan. Employees earned vacation pay of $19,500 for the period. The pension plan requires a contribution to the plan administrator equal to 6% of employee salaries. Salaries were $260,000 during the period, and the full amount due was contributed to the pension plan administrator.
Provide the journal entry for the (a) vacation pay and (b) pension benefit.
PE 11-6B
Vacation pay and pension benefits
1. Obj. 4
Regling Company provides its employees vacation benefits and a defined benefit pension plan. Employees earned vacation pay of $35,000 for the period. The pension formula calculated a pension cost of $201,250. Only $175,000 was contributed to the pension plan administrator.
Provide the journal entry for the (a) vacation pay and (b) pension benefit.