Exam 11: Current Liabilities and Payroll Accounting

An employee earns $5,500 per month working for an employer.The FICA tax rate for Social Security is 6.2% and the FICA tax rate for Medicare is 1.45%.The current FUTA tax rate is 0.6%,and the SUTA tax rate is 4.4%.Both unemployment taxes are applied to the first $7,000 of an employee's pay.The employee has $182 in federal income taxes withheld.The employee has voluntary deductions for health insurance of $150 and contributes $75 to a retirement plan each month.What is the amount the employer should record as payroll taxes expense for the employee for the month of January?

Early Co.offers its employees a bonus equal to 2% of the company's net income.The estimated net income for the year is expected to be $800,000.Prepare the general journal entry to record the estimated employee bonus plan expense.

Employee vacation benefits:

An employee earns $5,500 per month working for an employer.The FICA tax rate for Social Security is 6.2% and the FICA tax rate for Medicare is 1.45%.The current FUTA tax rate is 0.6%,and the SUTA tax rate is 4.4%.Both unemployment taxes are applied to the first $7,000 of an employee's pay.The employee has $182 in federal income taxes withheld.The employee has voluntary deductions for health insurance of $150 and contributes $75 to a retirement plan each month.What is the amount of net pay for the employee for the month of January?

Companies with many employees often use a special ____________________ account to pay employees.

The employer should record deductions from employee pay as:

______________ are amounts owed to suppliers for products or services purchased on credit.

On May 22,Jarrett Company borrows $7,500 from Fairmont Financing,signing a 90-day,8%,$7,500 note.What is the journal entry needed to record the transaction by Jarrett Company?

The rate that a state assigns reflecting a company's stability or instability in employing workers is the:

A company's employees had the following earnings records at the close of the current payroll period: The company's payroll taxes expense on each employee's earnings includes: FICA Social Security taxes of 6.2% on the first $117,000 of earnings plus 1.45% FICA Medicare on all wages;0.6% federal unemployment taxes on the first $7,000;and 2.5% state unemployment taxes on the first $7,000.Compute the employer's total payroll taxes expense for the current pay period.

A company's income before interest expense and income taxes is $350,000 and its interest expense is $100,000.Its times interest earned ratio is:

On September 15,SkateWorld borrowed $70,000 cash from Mutual Bank by signing a 6%,60-day note payable. a.Prepare SkateWorld's journal entry to record the issuance of the note payable. b.Prepare SkaetWorld's journal entry to record the payment of the note at maturity.

______________________ are amounts received in advance from customers for future products or services.

All of the following statements regarding uncertainty in liabilities are true except:

Triston Vale is paid on a monthly basis.For the month of January of the current year,he earned a total of $5,210.FICA tax for Social Security is 6.2% and the FICA tax for Medicare is 1.45%.The FUTA tax rate is 0.6%,and the SUTA tax rate is 5.4%.Both unemployment taxes are applied to the first $7,000 of an employee's pay.The amount of Federal Income Tax withheld from his earnings was $885.70.What is the amount of the employer's payroll taxes expenses for this employee?

In the accounting records of a defendant,lawsuits:

On December 1,Victoria Company signed a 90-day,6% note payable,with a face value of $15,000.What amount of interest expense is accrued at December 31 on the note?

During June,Vixen Fur Company sells $850,000 in merchandise that has a one year warranty.Experience shows that warranty expenses average about 3% of the selling price.Customers returned $14,000 of merchandise for warranty replacement during the month.The entry to settle the customer warranties is:

An estimated liability:

All of the following statements related to current liabilities for U.S.GAAP and IFRS are true except: