PR ACCT Homework Week 2

Sergio Ruvalcaba
Homework Week 2
WI2021-ACCTG-220-L1
1/21/2021
1. Abreu Company allows employees the option of carrying over unused vacation days or
“cashing” them out. If they cash out, does the employer count the time or earnings when
calculating overtime for these nonexempt employees?
 In this situation, the company does not have to count the earnings of the
encashment of unused vacation days while calculating overtime for these non-
exempt employees. The reason is because the Fair Labor Standards Act does not
cover payment for vacation days among other things like extra wages for weekly
off-days and holidays.
2. Along with many other companies, Sanchez Printers observes the Friday after
Thanksgiving as a paid holiday. The company requires each employee to make up
Friday’s lost hours in the following workweek by working extra hours without pay. Is
Sanchez Printers proceeding legally by requiring its employees to work extra hours
without compensation to make up for the hours lost on the Friday holiday? Explain.
 Asking your employees to work extra hours without pay is illegal and will be
treated unfair. The FLSA does not recognize the holidays off Friday after
Thanksgiving that is given by Sanchez Printers. Also, FLSA employees covered
under the act should be paid at least minimum wage for the actual work hours.
Therefore, Sanchez Printers cannot ask its employees to work without any
payment and will violate the provisions of the FLSA by doing so and would be
treated as illegal.
3. Lidle Company needs time to calculate employees’ overtime payments by the end of the
pay period in which the overtime is worked. Can it pay the overtime payments with the
following period’s paycheck?
 With the FLSA, a workweek refers to a fixed period of 168 hours or seven
consecutive 24-hour periods. The overtime hours worked in any workweek cannot
be shifted and merged with another workweek. Therefore, each workweek is
treated as a separate and independent unit for computing the overtime pay. In this
case, Lidle Company needs time to calculate employees’ overtime payments by
the end of the pay period in which overtime is worked. If the company intends to
make the overtime payment with the following workweek’s paycheck, Lidle
Company will be debarred from doing so. The final answer is no. The company
cannot pay the overtime amount with the following period’s paycheck.
4. The Payroll Department of DuMont has a policy of waiting one full week before
correcting any paycheck errors of $30 or less. However, any pay shortages that exceed
$30 are made up the same day. Also, any amounts less than $30 are made up the same
day when the particular circumstances of the employees indicate that it would place an
undue hardship on them to wait until the next pay one week later.
Denise Harris, an order checker in DuMont’s Shipping Department, discovered an error

of $28.34 in her weekly check. When Harris reported the error, a payroll clerk informed
her that she would have to wait until the next week’s paycheck to recover the amount,
since the underpayment was less than $30.
What is your reaction to DuMont’s policy of providing for paycheck corrections?

Assume that Harris protests the delay and in court argues that her earned wages should be
paid on the date due. As the judge hearing the case, how would you decide?
 Personally, I do not agree with the department’s policy of waiting one full week
before correcting any paycheck error of $30 or less. It violates the FLSA
regulations that all payments should be made at the end of the workweek and may
not be carried forward of the following week. When Denise received the $28.34
less in her paycheck and brought it to the payroll clerk and was told to wait until
the following week to receive the shortfall because it is less than $30. I would
have felt discourage having to receive a lesser-value paycheck.
 If we assume that Denise protested the delayed receiving of her earned wages and
pleaded that it should be paid on the due date. Personally, I support Denies Harris
and scolded The Payroll Department of DuMont for violating provisions from the
FLSA. I would have ordered DuMont to releasee her payment immediately with
penalties for withholding her earned due wages.
5. Mack Banta, a nonexempt account representative, worked extra hours this week as a call
operator. A number of operators were out for the week and Banta was asked to pick up
some of their hours. Can the company pay Banta at a lower pay rate for the hours he
worked as an operator? These extra hours also pushed Banta’s work time over 40 hours.
How should the company calculate Banta’s overtime pay?
 According to the FLSA as amended by the Equal Pay Act, both men and women
performing equal work must receive equal pay. If Mack was asked to work as
the call operator, even though he is a nonexempt employee working over 40
hours, the company cannot lower his pay rate.
 Since the extra hours that Mack worked pushed his total hours worked passed
40 hours, he is entitled to overtime compensation of time and a half.

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Sergio Ruvalcaba

Denise Harris, an order checker in DuMont’s Shipping Department, discovered an error

What is your reaction to DuMont’s policy of providing for paycheck corrections?

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