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1)California University has a fiscal year ending June 30th

Accounting

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1)California University has a fiscal year ending June 30^th. California University (CU) has a policy in which all tenured professors who have worked for CU for a minimum of 2 years may take a one semester sabbatical every 3 years in order to focus exclusively on research.    During the sabbatical the professor will still be compensated by CU. As of June 30, 2020 CU estimates that the annual payroll cost for faculty taking sabbaticals in the upcoming fiscal year to be $2,000,000.  

Accounting Issue: Is CU required to accrue the cost of the faculty sabbaticals as of June 30, 2020?

1. Codification Reference:

2.   Guidance: (cut and paste the guidance)

3. Your answer/interpretation of the guidance for how it applies to CU; should CU accrue for the sabbaticals as of June 30, 2020?

4. If a journal entry is required record the journal entry. If no journal entry is required indicate N/A