Question 1

The paid absence that is most commonly accrued is

Accepted Answer

A)  voting leave. 
B)  vacation time. 
C)  maternity leave. 
D)  disability leave. 
A)  voting leave. 
B)  vacation time. 
C)  maternity leave. 
D)  disability leave.

Question 2

The following totals for the month of April were taken from the payroll register of Kirk Company.   The journal entry to record the monthly payroll on April 30 would include a

Accepted Answer

A)  debit to Salaries Expense for $24,000. 
B)  credit to Salaries Payable for $24,000. 
C)  debit to Salaries Payable for $24,000. 
D)  debit to Salaries Expense for $17,000. 
A)  debit to Salaries Expense for $24,000. 
B)  credit to Salaries Payable for $24,000. 
C)  debit to Salaries Payable for $24,000. 
D)  debit to Salaries Expense for $17,000.

Question 3

In a given year, total warranty expense is the sum of actual warranty costs incurred on units sold plus the estimated cost of servicing those units in the future.

Accepted Answer

A) True 
 B)False

Question 4

Marx Company sells exercise machines for home use. The machines carry a 2-year warranty. Past experience indicates that 6% of the units sold will be returned during the warranty period for repairs. The average cost of repairs under warranty is $60 for labor and $90 for parts per unit. During 2010, 2,500 exercise machines were sold at an average price of $800. During the year, 60 of the machines that were sold were repaired at the average price per unit.
Instructions
(a) Prepare the journal entry to record the repairs made under warranty.
(b) Prepare the journal entry to record the estimated warranty expense for the year.

Accepted Answer

The answer of Marx Company sells exercise machines for home...

Question 5

On October 1, Steve's Carpet Service borrows $250,000 from First National Bank on a 3-month, $250,000, 8% note. What entry must Steve's Carpet Service make on December 31 before financial statements are prepared?

Accepted Answer

The answer of On October 1, Steve's Carpet Service borrows...

Question 6

Sales taxes collected by a retailer are reported as

Accepted Answer

A)  contingent liabilities. 
B)  revenues. 
C)  expenses. 
D)  current liabilities. 
A)  contingent liabilities. 
B)  revenues. 
C)  expenses. 
D)  current liabilities.

Question 7

The following totals for the month of June were taken from the payroll register of Ford Company.   The entry to record accrual of Ford Company's payroll taxes would include a

Accepted Answer

A)  debit to Payroll Tax Expense for $2,693 
B)  credit to Payroll Tax Expense for $2,693 
C)  credit to FICA Taxes Payable for $1,160. 
D)  credit to Payroll Tax Expense for $1,160. 
A)  debit to Payroll Tax Expense for $2,693 
B)  credit to Payroll Tax Expense for $2,693 
C)  credit to FICA Taxes Payable for $1,160. 
D)  credit to Payroll Tax Expense for $1,160.

Question 8

Employee earnings records for Shoemaker Company reveal the following gross earnings for four employees through the pay period of December 15.   
For the pay period ending December 31, each employee's gross earnings is $3,800. The FICA tax rate is 8% on gross earnings of $100,000.
Instructions
Compute the FICA withholdings that should be made for each employee for the December 31 pay period. (Show computations.)

Accepted Answer

C. Glenn $3,800 × 8% = $304. Glenn's tot

Question 9

Pickett Company typically sells subscriptions on an annual basis, and publishes six times a year. The magazine sells 60,000 subscriptions in January at $15 each. What entry is made in January to record the sale of the subscriptions?

Accepted Answer

The answer of Pickett Company typically sells subscriptions on an...

Question 10

The effective federal unemployment tax rate is usually

Accepted Answer

A)  6.2%. 
B)  0.8%. 
C)  5.4%. 
D)  8.0%. 
A)  6.2%. 
B)  0.8%. 
C)  5.4%. 
D)  8.0%.

Question 11

Howell Company has the following selected accounts after posting adjusting entries:   
Instructions
(a) Prepare the current liability section of Howell Company's balance sheet, assuming $25,000 of the mortgage is payable next year. (List liabilities in magnitude order, with largest first.)
(b) Comment on Howell 's liquidity, assuming total current assets are $450,000.

Accepted Answer

(b) The liquidity position looks favorab

Question 12

The journal entry to record the payroll for Detwiler Company for the week ending January 8, would probably include a

Accepted Answer

A)  credit to Office Salaries. 
B)  credit to Wages Expense. 
C)  debit to Federal Income Taxes Payable. 
D)  credit to FICA Taxes Payable. 
A)  credit to Office Salaries. 
B)  credit to Wages Expense. 
C)  debit to Federal Income Taxes Payable. 
D)  credit to FICA Taxes Payable.

Question 13

Sales taxes collected by the retailer are recorded as a(n)

Accepted Answer

A)  revenue. 
B)  liability. 
C)  expense. 
D)  asset. 
A)  revenue. 
B)  liability. 
C)  expense. 
D)  asset.

Question 14

Notes payable usually are issued to meet long-term financing needs.

Accepted Answer

A) True 
 B)False

Question 15

FICA Taxes Payable was credited for $9,000 in the entry when Peltry Company recorded payroll. When Peltry Company records employer's payroll taxes, FICA Taxes Payable should be credited for:

Accepted Answer

A)  $0. 
B)  $9,000. 
C)  $18,000. 
D)  some other amount. 
A)  $0. 
B)  $9,000. 
C)  $18,000. 
D)  some other amount.

Question 16

Working capital is

Accepted Answer

A)  current assets plus current liabilities. 
B)  current assets minus current liabilities. 
C)  current assets divided by current liabilities. 
D)  current assets multiplied by current liabilities. 
A)  current assets plus current liabilities. 
B)  current assets minus current liabilities. 
C)  current assets divided by current liabilities. 
D)  current assets multiplied by current liabilities.

Question 17

The interest charged on a $50,000 note payable, at the rate of 8%, on a 3-month note would be

Accepted Answer

A)  $4,000. 
B)  $2,000. 
C)  $1,000. 
D)  $667. 
A)  $4,000. 
B)  $2,000. 
C)  $1,000. 
D)  $667.

Question 18

Valerie's Salon has total receipts for the month of $16,430 including sales taxes. If the sales tax rate is 6%, what are Valerie's sales for the month?

Accepted Answer

A)  $15,444.20 
B)  $17,415.80 
C)  $15,500.00 
D)  It cannot be determined. 
A)  $15,444.20 
B)  $17,415.80 
C)  $15,500.00 
D)  It cannot be determined.

Question 19

Liabilities are classified on the balance sheet as being _______________ liabilities or ______________ liabilities.

Accepted Answer

The answer of Liabilities are classified on the balance sheet...

Question 20

The following payroll liability accounts are included in the ledger of Eckstrom Company on January 1, 2010:   
In January, the following transactions occurred:
Jan. 9 Sent a check for $5,000 to Blue Cross and Blue Shield.
11 Deposited a check for $5,750 in Federal Reserve Bank for FICA taxes and federal income taxes withheld.
14 Sent a check for $400 to the union treasurer for union dues.
18 Paid state income taxes withheld from employees.
21 Paid state and federal unemployment taxes.
22 Sent a $1,500 check to a Savings and Loan for the Christmas Club withholdings.
Instructions
Journalize the January transactions

Accepted Answer

The answer of The following payroll liability accounts are included...

Exam 11: Current Liabilities and Payroll Accounting

The paid absence that is most commonly accrued is

The following totals for the month of April were taken from the payroll register of Kirk Company. The journal entry to record the monthly payroll on April 30 would include a

In a given year, total warranty expense is the sum of actual warranty costs incurred on units sold plus the estimated cost of servicing those units in the future.

On October 1, Steve's Carpet Service borrows $250,000 from First National Bank on a 3-month, $250,000, 8% note. What entry must Steve's Carpet Service make on December 31 before financial statements are prepared?

Sales taxes collected by a retailer are reported as

The following totals for the month of June were taken from the payroll register of Ford Company. The entry to record accrual of Ford Company's payroll taxes would include a

Pickett Company typically sells subscriptions on an annual basis, and publishes six times a year. The magazine sells 60,000 subscriptions in January at $15 each. What entry is made in January to record the sale of the subscriptions?

The effective federal unemployment tax rate is usually

The journal entry to record the payroll for Detwiler Company for the week ending January 8, would probably include a

Sales taxes collected by the retailer are recorded as a(n)

Notes payable usually are issued to meet long-term financing needs.

FICA Taxes Payable was credited for $9,000 in the entry when Peltry Company recorded payroll. When Peltry Company records employer's payroll taxes, FICA Taxes Payable should be credited for:

Working capital is

The interest charged on a $50,000 note payable, at the rate of 8%, on a 3-month note would be

Valerie's Salon has total receipts for the month of $16,430 including sales taxes. If the sales tax rate is 6%, what are Valerie's sales for the month?

Liabilities are classified on the balance sheet as being _______________ liabilities or ______________ liabilities.

Accounting in Action

The Recording Process

Adjusting the Accounts

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories

Accounting Information Systems

Fraud, Internal Control, and Cash

Accounting for Receivables

Plant Assets, Natural Resources, and Intangible Assets

Accounting for Partnerships

Corporations: Organization and Capital Stock Transactions

Corporations: Dividends, Retained Earnings, and Income Reporting

Long-Term Liabilities

Investments

Statement of Cash Flows

Financial Analysis: the Big Picture

Managerial Accounting

Job Order Costing

Process Costing

Cost-Volume-Profit

Incremental Analysis

Budgetary Planning

Budgetary Control and Responsibility Accounting

Standard Costs and Balanced Scorecard

Filters

Liabilities are classified on the balance sheet as being _ liabilities or liabilities.