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Exam 10: Liabilities: Current,installment Notes,and Contingencies

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Question 61

Multiple Choice

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Which of the following is required to be withheld from employee's gross pay?

A) both federal and state unemployment compensation taxes
B) only federal unemployment compensation tax
C) only federal income tax
D) only state unemployment compensation tax

E) None of the above
F) A) and C)

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Question 62

Multiple Choice

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​The journal entry a company uses to record pension rights that have not been funded for its salaried employees at the end of the year is

A) ​debit Salary Expense; credit Cash
B) ​debit Pension Expense; credit Unfunded Pension Liability
C) ​debit Pension Expense; credit Unfunded Pension Liability and Cash
D) ​debit Pension Expense; credit Cash

E) None of the above
F) C) and D)

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Question 63

Multiple Choice

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Davis and Thompson have earnings of $850 each.The social security tax rate is 6% and the Medicare tax rate is 1.5%.Assuming that the payroll will be paid on December 29,what will be the employer's total FICA tax for this payroll period?

Perez Company has the following information for the pay period of January 15-31. ​ Assuming no employees are subject to ceilings for their earnings,calculate salaries payable and employer payroll taxes payable.

Journalize the following entries on the books of the borrower and creditor.Label accordingly.(Assume a 360-day year is used for interest calculations.)

Hall Company sells merchandise with a one-year warranty.In the current year,sales consisted of 4,500 units.It is estimated that warranty repairs will average $10 per unit sold,and 30% of the repairs will be made in the current year and 70% in the next year.In the current year's income statement,Hall should show warranty expense of

Assume that social security taxes are payable at a 6% rate and Medicare taxes are payable at a 1.5% rate with no maximum earnings,and that federal and state unemployment compensation taxes total 4.6% on the first $7,000 of earnings.If an employee earns $2,500 for the current week and the employee's year-to-date earnings before this week were $6,800,what is the total employer payroll taxes related to the current week?

Match the following terms or phrases in (a-g) with the explanations in 1-8.Terms or phrases may be used more than once. -Current assets - Current liabilities

The following totals for the month of June were taken from the payroll register of Arcon Company: ​ The entry to record the payment of net pay would include a

The discount on a note payable is charged to an account that has a normal credit balance.

Federal income taxes withheld increase the employer's payroll tax expense.

An employee receives an hourly wage rate of $15,with time and a half for all hours worked in excess of 40 during the first week of the calendar year.Payroll data for the first week of the calendar year are as follows: hours worked,48; federal income tax withheld,$120; social security tax rate,6%; and Medicare tax rate,1.5%; state unemployment compensation tax,3.4% on the first $7,000; federal unemployment compensation tax,0.8% on the first $7,000.What is the net amount to be paid to the employee?

Hadley Industries warrants its products for one year.The estimated product warranty expense is 4% of sales.Assume that sales were $210,000 for June.In July,a customer received warranty repairs requiring $205 of parts and $75 of labor.

An employee receives an hourly rate of $15,with time and a half for all hours worked in excess of 40 during the week.Payroll data for the current week are as follows: hours worked,46; federal income tax withheld,$120; all earnings are subject to social security tax; Social security tax rate,6%; and Medicare tax rate,1.5%; state unemployment compensation tax,3.4% on the first $7,000; federal unemployment compensation tax,0.8% on the first $7,000.Prepare the journal entries to record the salaries expense and the employer payroll tax expense.If required,round your answers to the nearest cent.

Most employers are levied a tax on payrolls for

On June 8,Williams Company issued an $80,000,5%,120-day note payable to Brown Industries.Assuming a 360-day year,what is the maturity value of the note? When required,round your answer to the nearest dollar.

Most employers are required to withhold federal unemployment taxes from employee earnings.

Sadie White receives an hourly rate of $30,with time and a half for all hours worked in excess of 40 during a week.Payroll data for the current week are as follows: hours worked,48; federal income tax withheld,$300; social security tax rate,6.0%; and Medicare tax rate,1.5%.What is the net amount to be paid to White?

The entry to record accrual of employer's payroll taxes would include a

The journal entry a company uses to record accrued vacation privileges for its employees at the end of the year is