Pirate Ltd employs 5 staff. Each staff member is entitled to 20 days annual leave per annum. Leave loading of 17.5% is paid when the leave is taken. At 1 July 2013 the balance in the provision for annual leave account was $20 303.
Details of each employee's leave entitlement at 30 June 2014 are as follows:

There are 260 work days in a year. On 1 July each year all employees receive a 5% wage rise. There are no other wage rises given during the year.
Annual leave payments made during the year were debited against the provision account. The total debit against the annual leave account during the year in relation to leave taken was:

Question

Pirate Ltd employs 5 staff. Each staff member is entitled to 20 days annual leave per annum. Leave loading of 17.5% is paid when the leave is taken. At 1 July 2013 the balance in the provision for annual leave account was $20 303.
Details of each employee's leave entitlement at 30 June 2014 are as follows:

There are 260 work days in a year. On 1 July each year all employees receive a 5% wage rise. There are no other wage rises given during the year.
Annual leave payments made during the year were debited against the provision account. The total debit against the annual leave account during the year in relation to leave taken was:

Quizplus · Accepted Answer

To calculate the total debit against the annual leave account during the year, we need to determine the total amount of annual leave taken by all employees and the total leave loading payable.

Total amount of annual leave taken by all employees: 
Employee 1: 20 days x 1 = 20 days
Employee 2: 20 days x 1 = 20 days
Employee 3: 20 days x 2 = 40 days
Employee 4: 20 days x 1.5 = 30 days
Employee 5: 20 days x 1 = 20 days
Total: 130 days

Total leave loading payable: 
$3,000 + $3,000 + $5,775 + $4,312.50 + $3,000 = $19,087.50

Therefore, the total debit against the annual leave account during the year in relation to leave taken was:
130 days x ($112,500/260) + $19,087.50 = $33,585

Hence, the best choice is C.

Pirate Ltd Employs 5 Staff