Question 1

Use the following key a-d) to identify the proper treatment of each contingent liability.
-Event is probable but amount is not estimable

Accepted Answer

A) Record only 
B) Record and disclose 
C) Disclose only 
D) Do not record or disclose 
A) Record only 
B) Record and disclose 
C) Disclose only 
D) Do not record or disclose

Question 2

Baker Green's weekly gross earnings for the week ending December 7 were $2,500, and her federal income tax withholding was $525. Prior to this week Green had earned $98,000 for the year. Assuming the social security rate is 6% and Medicare is 1.5%, what is Green's net pay?

Accepted Answer

The answer of Baker Green's weekly gross earnings for the...

Question 3

Vacation pay payable is reported on the balance sheet as an)

Accepted Answer

A)  current liability or long-term liability, depending upon when the vacations will be taken by employees 
B)  current liability 
C)  expense 
D)  long-term liability 
A)  current liability or long-term liability, depending upon when the vacations will be taken by employees 
B)  current liability 
C)  expense 
D)  long-term liability

Question 4

Match the following terms or phrases in a-g) with the explanations in 1-8. Terms or phrases may be used more than once.
-Cash + Temporary investments + Accounts receivable)/Current liabilities

Accepted Answer

A) Current ratio 
B) Working capital 
C) Quick assets 
D) Quick ratio 
E) Record an accrual and disclose in the notes to the financial statements
F)Disclose only in notes to financial statements
G)No disclosure needed in notes to financial statements 
A) Current ratio 
B) Working capital 
C) Quick assets 
D) Quick ratio 
E) Record an accrual and disclose in the notes to the financial statements
F)Disclose only in notes to financial statements
G)No disclosure needed in notes to financial statements

Question 5

Match each payroll item that follows to the one item a-f) that best describes its characteristics.
-Federal unemployment compensation tax FUTA)

Accepted Answer

A) Amount is limited, withheld from employee only 
B) Amount is limited, withheld from employee and matched by employer 
C) Amount is limited, paid by employer only 
D) Amount is not limited, withheld from employee only 
E) Amount is not limited, withheld from employee and matched by employer
F)Amount is not limited, paid by employer only 
A) Amount is limited, withheld from employee only 
B) Amount is limited, withheld from employee and matched by employer 
C) Amount is limited, paid by employer only 
D) Amount is not limited, withheld from employee only 
E) Amount is not limited, withheld from employee and matched by employer
F)Amount is not limited, paid by employer only

Question 6

Most employers use payroll checks drawn on a special bank account for paying the payroll.

Accepted Answer

A) True 
 B)False

Question 7

The payroll register of Seaside Architecture Company indicates $870 of social security and $217 of Medicare tax withheld on total salaries of $14,500 for the period. Assume earnings subject to state and federal unemployment compensation taxes are $5,250 at the federal rate of 0.8% and state rate of 5.4%. Prepare the journal entry to record the payroll tax expense for the period.

Accepted Answer

@#IMG-DLM& *$5,250 ×

Question 8

Interest expense is reported in the operating expense section of the income statement.

Accepted Answer

A) True 
 B)False

Question 9

Obligations that may arise from past transactions only if certain events occur in the future are contingent liabilities.

Accepted Answer

A) True 
 B)False

Question 10

On July 8, Jones Inc. issued an $80,000, 6%, 120-day note payable to Miller Company. Assume that the fiscal year of Jones ends July 31. Using the 360-day year, what is the amount of interest expense recognized by Jones in the current fiscal year?

Accepted Answer

A)  $700 
B)  $4,200 
C)  $307 
D)  $1,400 
A)  $700 
B)  $4,200 
C)  $307 
D)  $1,400

Question 11

An aid in internal control over payrolls that indicates employee attendance is

Accepted Answer

A)  time card 
B)  voucher system 
C)  payroll register 
D)  employee's earnings record 
A)  time card 
B)  voucher system 
C)  payroll register 
D)  employee's earnings record

Question 12

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?

Accepted Answer

A)  $1,443.00 
B)  $1,143.00 
C)  $1,260.00 
D)  $1,000.00 
A)  $1,443.00 
B)  $1,143.00 
C)  $1,260.00 
D)  $1,000.00

Question 13

Federal unemployment compensation taxes that are collected by the federal government are not paid directly to the unemployed but are allocated among the states for use in state programs.

Accepted Answer

A) True 
 B)False

Question 14

Martin Services Company provides its employees vacation benefits and a defined contribution pension plan. Employees earned vacation pay of $39,500 for the period. The pension plan requires a contribution to the plan administrator equal to 9% of employee salaries. Salaries were $750,000 during the period. Provide the journal entries for a) the vacation pay and b) the pension benefit.

Accepted Answer

a) Vacation Pay Expe

Question 15

The following totals for the month of June were taken from the payroll register of Young Company:   The entry to record the accrual of employer's payroll taxes would include a debit to "0.8% Medicare rate"
"1)5%State unemployment tax rate"
5)4%

Accepted Answer

A)  Payroll Tax Expense for $2,498 
B)  Social Security and Medicare Tax Payable for $2,250 
C)  Payroll Tax Expense for $1,373 
D)  Payroll Tax Expense for $1,125 
A)  Payroll Tax Expense for $2,498 
B)  Social Security and Medicare Tax Payable for $2,250 
C)  Payroll Tax Expense for $1,373 
D)  Payroll Tax Expense for $1,125

Question 16

Match each payroll item that follows to the one item a-f) that best describes its characteristics.
-FICA - Medicare

Accepted Answer

A) Amount is limited, withheld from employee only 
B) Amount is limited, withheld from employee and matched by employer 
C) Amount is limited, paid by employer only 
D) Amount is not limited, withheld from employee only 
E) Amount is not limited, withheld from employee and matched by employer
F)Amount is not limited, paid by employer only 
A) Amount is limited, withheld from employee only 
B) Amount is limited, withheld from employee and matched by employer 
C) Amount is limited, paid by employer only 
D) Amount is not limited, withheld from employee only 
E) Amount is not limited, withheld from employee and matched by employer
F)Amount is not limited, paid by employer only

Question 17

A current liability is a debt that is reasonably expected to be paid

Accepted Answer

A)  between 6 months and 18 months 
B)  out of currently recognized revenues 
C)  within one year 
D)  out of cash currently on hand 
A)  between 6 months and 18 months 
B)  out of currently recognized revenues 
C)  within one year 
D)  out of cash currently on hand

Question 18

Match the following terms or phrases in a-g) with the explanations in 1-8. Terms or phrases may be used more than once.
-Probable likelihood of a liability but cannot be estimated

Accepted Answer

A) Current ratio 
B) Working capital 
C) Quick assets 
D) Quick ratio 
E) Record an accrual and disclose in the notes to the financial statements
F)Disclose only in notes to financial statements
G)No disclosure needed in notes to financial statements 
A) Current ratio 
B) Working capital 
C) Quick assets 
D) Quick ratio 
E) Record an accrual and disclose in the notes to the financial statements
F)Disclose only in notes to financial statements
G)No disclosure needed in notes to financial statements

Question 19

Journalize the following, assuming a 360-day year is used for interest calculations:
Apr. 30 Issued a $150,000, 30-day, 6% note dated April 30 to Misner Co. on account. May 30 Paid Misner Co. the amount owed on the note dated April 30.

Accepted Answer

Apr. 30 Accounts Payable-Misne

Question 20

The journal entry to record the monthly payroll on April 30 would include a

Accepted Answer

A)  credit to Salaries Payable for $8,150 
B)  debit to Salaries Expense for $7,902 
C)  debit to Salaries Payable for $8,150 
D)  debit to Salaries Payable for $7,902 
A)  credit to Salaries Payable for $8,150 
B)  debit to Salaries Expense for $7,902 
C)  debit to Salaries Payable for $8,150 
D)  debit to Salaries Payable for $7,902

Exam 10: Current Liabilities and Payroll

Use the following key a-d) to identify the proper treatment of each contingent liability. -Event is probable but amount is not estimable

Baker Green's weekly gross earnings for the week ending December 7 were $2,500, and her federal income tax withholding was $525. Prior to this week Green had earned $98,000 for the year. Assuming the social security rate is 6% and Medicare is 1.5%, what is Green's net pay?

Vacation pay payable is reported on the balance sheet as an)

Match the following terms or phrases in a-g) with the explanations in 1-8. Terms or phrases may be used more than once. -Cash + Temporary investments + Accounts receivable)/Current liabilities

Match each payroll item that follows to the one item a-f) that best describes its characteristics. -Federal unemployment compensation tax FUTA)

Most employers use payroll checks drawn on a special bank account for paying the payroll.

Interest expense is reported in the operating expense section of the income statement.

Obligations that may arise from past transactions only if certain events occur in the future are contingent liabilities.

On July 8, Jones Inc. issued an $80,000, 6%, 120-day note payable to Miller Company. Assume that the fiscal year of Jones ends July 31. Using the 360-day year, what is the amount of interest expense recognized by Jones in the current fiscal year?

An aid in internal control over payrolls that indicates employee attendance is

Federal unemployment compensation taxes that are collected by the federal government are not paid directly to the unemployed but are allocated among the states for use in state programs.

The following totals for the month of June were taken from the payroll register of Young Company: The entry to record the accrual of employer's payroll taxes would include a debit to "0.8% Medicare rate" "1)5%State unemployment tax rate" 5)4%

Match each payroll item that follows to the one item a-f) that best describes its characteristics. -FICA - Medicare

A current liability is a debt that is reasonably expected to be paid

Match the following terms or phrases in a-g) with the explanations in 1-8. Terms or phrases may be used more than once. -Probable likelihood of a liability but cannot be estimated

Journalize the following, assuming a 360-day year is used for interest calculations: Apr. 30 Issued a $150,000, 30-day, 6% note dated April 30 to Misner Co. on account. May 30 Paid Misner Co. the amount owed on the note dated April 30.

The journal entry to record the monthly payroll on April 30 would include a

Introduction to Accounting and Business

Analyzing Transactions

The Adjusting Process

Completing the Accounting Cycle

Accounting for Merchandising Businesses

Inventories

Sarbanes-Oxley, Internal Control, and Cash

Receivables

Fixed Assets and Intangible Assets

Corporations: Organization, Stock Transactions, and Dividends

Long-Term Liabilities: Bonds and Notes

Investments and Fair Value Accounting

Statement of Cash Flows

Financial Statement Analysis

Managerial Accounting Concepts and Principles

Job Order Costing

Process Cost Systems

Cost Behavior and Cost-Volume-Profit Analysis

Variable Costing for Management Analysis

Budgeting

Performance Evaluation Using Variances From Standard Costs

Performance Evaluation for Decentralized Operations

Differential Analysis, Product Pricing, and Activity-Based Costing

Capital Investment Analysis

Cost Allocation and Activity-Based Costing

Lean Principles, Lean Accounting, and Activity Analysis

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