Question 1

Contingent liabilities are recorded in the accounts if the future event is _______________ and the amount owed can be _______________.

Accepted Answer

Answers m

Question 2

Match between columns
                        Premises: A record for a pay period that shows the pay period dates,regular and overtime hours worked,gross pay,net pay and deductions.
Additional compensation paid to or on behalf of employees,such as premiums for medical insurance and contributions to pension plans.
Payments of income taxes that are deferred until future years because of temporary differences between GAAP and tax accounting rules.
Total compensation earned by an employee.
A bank authorized to accept deposits of amounts payable to the federal government, including payroll taxes.
Obligations due within one year or the company's operating cycle,whichever is longer.
A written promise to pay a specified amount on a definite future date within one year or the company's operating cycle,whichever is longer.
A special bank account used solely for paying employees; each pay period an amount equal to the total employees' net pay is deposited and the employees' payroll checks are drawn on that account.
Income before interest expense and income taxes divided by interest expense.
A seller's obligation to repair or replace a product or service that fails to perform as expected within a specified period.

Accepted Answer

The Answer of Payroll register and Gross pay and Short-term is...

Question 3

All of the following statements regarding long-term liabilities are true except?

Accepted Answer

A) Liabilities not expected to be paid within the longer of one year or the company's operating cycle are reported as long-term liabilities. 
B) Long-term liabilities include long-term notes payable, warranty liabilities, lease liabilities, and bonds payable. 
C) Liabilities that do not have a fixed due date, but are payable on demand, are reported as long-term liabilities. 
D) Long-term liabilities can be reported on the balance sheet in a single total or in multiple categories. 
E) A single long-term liability can be divided between current and noncurrent sections on the balance sheet. 
A) Liabilities not expected to be paid within the longer of one year or the company's operating cycle are reported as long-term liabilities. 
B) Long-term liabilities include long-term notes payable, warranty liabilities, lease liabilities, and bonds payable. 
C) Liabilities that do not have a fixed due date, but are payable on demand, are reported as long-term liabilities. 
D) Long-term liabilities can be reported on the balance sheet in a single total or in multiple categories. 
E) A single long-term liability can be divided between current and noncurrent sections on the balance sheet.

Question 4

Sales taxes payable is credited and cash is debited when companies send sales taxes collected from customers to the government.

Accepted Answer

A) True 
 B)False

Question 5

On June 1,Martin Company signed a $25,000,120-day,6% note payable to cover a past due account payable.
a.What is the total amount of interest to be paid on this note?
b.Prepare Martin Company's general journal entry to record the issuance of the note payable.
c.Prepare Martin Company's general journal entry to record the payment of the note on September 29.

Accepted Answer

The answer of On June 1,Martin Company signed a $25,000,120-day,6%...

Question 6

A company's income before interest expense and income taxes in 2010 and 2011 is $225,000 and $200,000,respectively.Its interest expense was $45,000 for both years.Calculate the company's times interest earned ratio,and comment on its level of risk.

Accepted Answer

Risk analysis: The income before interes

Question 7

Known liabilities:

Accepted Answer

A) Include accounts payable, notes payable, and payroll. 
B) Are obligations set by agreements, contracts, or laws. 
C) Are measurable. 
D) Are definitely determinable. 
E) All of the choices are correct. 
A) Include accounts payable, notes payable, and payroll. 
B) Are obligations set by agreements, contracts, or laws. 
C) Are measurable. 
D) Are definitely determinable. 
E) All of the choices are correct.

Question 8

A company sells personal computers for $2,300 each.The price includes a two-year warranty.During the current year,the company sells 400 computers.On the basis of past experience,the warranty costs are estimated to be $250 per computer.The actual warranty costs (paid in cash)by the company during the current year were $65,000.Prepare general journal entries to record the (a)estimated warranty expense and (b)warranty repair costs during current year.

Accepted Answer

a. Warranty Expense (400 * $25

Question 9

Harvel Company is required by law to collect and remit sales taxes to the state.If Havel has $8,000 of cash sales that are subject to an 8% sales tax,what is the journal entry to record the cash sales?

Accepted Answer

A) Debit Cash $8,000; credit Sales $7,360; credit Sales Taxes Payable $640. 
B) Debit Sales Taxes Payable $640; debit Cash $7,360; credit Sales $8,000. 
C) Debit Cash $8,000; credit Sales $8,000; and record the taxes when paid. 
D) Debit Cash $8,640; credit Sales $8,000; credit Sales Taxes Payable $640. 
E) Debit Accounts Receivable $8,640; credit Sales $8,000; credit Sales Taxes Payable $640. 
A) Debit Cash $8,000; credit Sales $7,360; credit Sales Taxes Payable $640. 
B) Debit Sales Taxes Payable $640; debit Cash $7,360; credit Sales $8,000. 
C) Debit Cash $8,000; credit Sales $8,000; and record the taxes when paid. 
D) Debit Cash $8,640; credit Sales $8,000; credit Sales Taxes Payable $640. 
E) Debit Accounts Receivable $8,640; credit Sales $8,000; credit Sales Taxes Payable $640.

Question 10

All of the following statements regarding FICA taxes are true except:

Accepted Answer

A) FICA taxes are deducted from the employee. 
B) Employers must pay withheld FICA taxes to the IRS. 
C) The amount of FICA deducted from the employee is credited to a liability account. 
D) A self-employed person is exempt from FICA taxes. 
E) An employer must pay FICA taxes equal to the amount withheld from the employee. 
A) FICA taxes are deducted from the employee. 
B) Employers must pay withheld FICA taxes to the IRS. 
C) The amount of FICA deducted from the employee is credited to a liability account. 
D) A self-employed person is exempt from FICA taxes. 
E) An employer must pay FICA taxes equal to the amount withheld from the employee.

Question 11

Pastimes 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 $850,000.Prepare the general journal entry to record the employee bonus plan expense.

Accepted Answer

Employee Bonus Expense……………………

Question 12

Gross pay is:

Accepted Answer

A) Take-home pay. 
B) Total compensation earned by an employee before any deductions. 
C) Salaries after taxes are deducted. 
D) Deductions withheld by an employer. 
E) The amount of the paycheck. 
A) Take-home pay. 
B) Total compensation earned by an employee before any deductions. 
C) Salaries after taxes are deducted. 
D) Deductions withheld by an employer. 
E) The amount of the paycheck.

Question 13

FUTA requires employers to pay a federal unemployment tax on the first $7,000 in salary or wages paid to each employee.

Accepted Answer

A) True 
 B)False

Question 14

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

Accepted Answer

A) True 
 B)False

Question 15

Experience shows that when times interest earned falls below 1.5 to 2.0 and remains at that level or lower for several time periods,the default rate on liabilities increases sharply.

Accepted Answer

A) True 
 B)False

Question 16

__________ allowances are items that reduce the amount of federal income taxes owed by the individual.

Accepted Answer

The answer of __________ allowances are items that reduce the...

Question 17

A company's had fixed interest expense of $6,000,its income before interest expense and any income taxes is $18,000,and its net income is $8,400.The company's times interest earned ratio equals:

Accepted Answer

A) 0.33. 
B) 0.71. 
C) 1.40. 
D) 3.00. 
E) 12,000. 
A) 0.33. 
B) 0.71. 
C) 1.40. 
D) 3.00. 
E) 12,000.

Question 18

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 $106,800 of earnings plus 1.45% FICA Medicare on all wages; 0.8% 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.

Accepted Answer

The answer of A company's employees had the following earnings...

Question 19

The unemployment insurance program:

Accepted Answer

A) Is a joint federal and state program. 
B) Is administered by each state. 
C) Provides unemployment benefits to qualified workers. 
D) Adjusts rates paid by employers based on their merit rating. 
E) All of the choices are correct. 
A) Is a joint federal and state program. 
B) Is administered by each state. 
C) Provides unemployment benefits to qualified workers. 
D) Adjusts rates paid by employers based on their merit rating. 
E) All of the choices are correct.

Question 20

Unearned revenues are:

Accepted Answer

A) Also called deferred revenues. 
B) Amounts received in advance from customers for future delivery of products or services. 
C) Also called collections in advance. 
D) Also called prepayments. 
E) All of the choices are correct. 
A) Also called deferred revenues. 
B) Amounts received in advance from customers for future delivery of products or services. 
C) Also called collections in advance. 
D) Also called prepayments. 
E) All of the choices are correct.

Exam 11: Current Liabilities and Payroll Accounting

Contingent liabilities are recorded in the accounts if the future event is _______________ and the amount owed can be _______________.

All of the following statements regarding long-term liabilities are true except?

Sales taxes payable is credited and cash is debited when companies send sales taxes collected from customers to the government.

A company's income before interest expense and income taxes in 2010 and 2011 is $225,000 and $200,000,respectively.Its interest expense was $45,000 for both years.Calculate the company's times interest earned ratio,and comment on its level of risk.

Known liabilities:

Harvel Company is required by law to collect and remit sales taxes to the state.If Havel has $8,000 of cash sales that are subject to an 8% sales tax,what is the journal entry to record the cash sales?

All of the following statements regarding FICA taxes are true except:

Pastimes 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 $850,000.Prepare the general journal entry to record the employee bonus plan expense.

Gross pay is:

FUTA requires employers to pay a federal unemployment tax on the first $7,000 in salary or wages paid to each employee.

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

Experience shows that when times interest earned falls below 1.5 to 2.0 and remains at that level or lower for several time periods,the default rate on liabilities increases sharply.

__________ allowances are items that reduce the amount of federal income taxes owed by the individual.

A company's had fixed interest expense of $6,000,its income before interest expense and any income taxes is $18,000,and its net income is $8,400.The company's times interest earned ratio equals:

The unemployment insurance program:

Unearned revenues are:

Accounting in Business

Analyzing and Recording Transactions

Adjusting Accounts and Preparing Financial Statements

Completing the Accounting Cycle

Accounting for Merchandising Operations

Accounting Information Systems

Cash and Internal Controls

Accounting for Receivables

Plant Assets, natural Resources, and Intangibles

Accounting for Partnerships

Accounting for Corporations

Long-Term Liabilities

Investments and International Operations

Reporting the Statement of Cash Flows

Analysis of Financial Statements

Managerial Accounting Concepts and Principles

Job Order Costing

Process Costing

Cost-Volume-Profit Analysis

Master Budgets and Planning

Flexible Budgets and Standard Costs

Performance Measurement and Responsibility Accounting

Capital Budgeting and Managerial Decisions

Time Value of Money B

Activity-Based Costing C

Filters

Contingent liabilities are recorded in the accounts if the future event is _ and the amount owed can be _.