BRIEF EXERCISE 13-16

This is a non-accumulating compensated absence that is

recognized when the obligating event occurs.

December 1, 2014:
Employee Benefit Expense* ........................................... 11,952
Parental Leave Benefits Payable .......................... EI ffffs Payable (920 X 1.4) 11,952

* Salary for 17 weeks ($74,000 52 X 17) $24,192
Less: employment insurance
payments ($720/week X 17 weeks) (12,240)
Employee Benefit Expense $11,952

For each of the 4 weeks in December, 2014, Laurin Corporation
will pay Ruzbeh Awad a top up amount and record the payments
as follows:

Parental Leave Benefits Payable .................................... 703.08
Cash ........................................................................ EI Premiums Payable (920 X 1.4) 703.08
($74,000 52 weeks) = $1,423.08 $720.00 = $703.08

Benefits and payments NOT subject to EI
amounts you pay to an employee to cover the waiting period or to increase the maternity,
parental or compassionate care benefits if the following two conditions are met:
the total amount of your payment and the EI weekly benefits does not exceed the
employee's normal weekly gross salary; and
your payment does not reduce any other accumulated employment benefits such
as banked sick leave, vacation leave credits, or retiring allowance;

Top-up payments may be subject to CPP.