According to current GAAP, which of the following is not a condition suggesting that an accrual for vacation pay should be made?
A) The obligation must relate to rights that vest.
B) The payment of compensation is probable.
C) The obligation must relate to employee services already rendered.
D) The amount can be reasonably estimated.

Question

Quizplus · Accepted Answer

Under current GAAP, an accrual for vacation pay should be made if the obligation relates to employee services already rendered (C), the payment of compensation is probable (B), and the amount can be reasonably estimated (D). The obligation does not need to relate to rights that vest (A) for an accrual to be necessary.

According to Current GAAP, Which of the Following Is Not