Question 1

Federal unemployment compensation tax is paid by the employer and is not deducted from an employee's gross earnings.

Accepted Answer

A) True 
 B)False

Question 2

FICA tax is paid by the employee only.

Accepted Answer

A) True 
 B)False

Question 3

Northwest,Inc.records indicate that January sales on account were $109,000.The company's management estimates warranty expense to be 3.6% of sales.Prepare the journal entry to record warranty expense.

Accepted Answer

@#IMG-DLM&
Explanation:
Warran

Question 4

Investors use the times-interest-earned ratio to evaluate a company's ability to pay interest expense.

Accepted Answer

A) True 
 B)False

Question 5

Eric's gross pay for the week is $2,050.His deduction for federal income tax is based on a rate of 23%.He has no voluntary deductions.His yearly pay is under the limit for OASDI.What is the amount of FICA tax that will be withheld from Eric's pay? (Assume a FICA-OASDI Tax of 6.2% and FICA-Medicare Tax of 1.45%.Round any intermediate calculations to two decimal places,and your final answer to the nearest dollar. )

Accepted Answer

A) $471.50 
B) $156.83 
C) $628.33 
D) $130.15 
A) $471.50 
B) $156.83 
C) $628.33 
D) $130.15

Question 6

It is mandatory for both the employer and employee to pay ________.

Accepted Answer

A) FICA 
B) SUTA 
C) employee income tax 
D) federal unemployment tax 
A) FICA 
B) SUTA 
C) employee income tax 
D) federal unemployment tax

Question 7

Larry,an employee of Ramsay's,Inc. ,has gross salary for March of $4,000.The entire amount is under the OASDI limit of $117,000 and thus subject to FICA.He is also subject to federal income tax at a rate of 18%.Larry has a deduction of $320 for health insurance and $80 for United Way.Which of the following is included in the entry to record the liability of payroll withholding deductions?

Accepted Answer

A) debit to Salaries Payable 
B) credit to United Way Payable 
C) debit to FICA Taxes Payable 
D) debit to Cash 
A) debit to Salaries Payable 
B) credit to United Way Payable 
C) debit to FICA Taxes Payable 
D) debit to Cash

Question 8

Sandstorm,Inc.signed a 200-day,5%,$5,000 note on April 1,2017,and this was the only note payable for the company.Calculate the times-interest-earned ratio of Sandstorm,Inc.if its earnings before interest and taxes for the year ending December 31,2017,is $4,300.(Use a 360-day year. )

Accepted Answer

The answer of Sandstorm,Inc.signed a 200-day,5%,$5,000 note on April 1,2017,and...

Question 9

Grant,an employee of Fitzgerald,Inc. ,has gross salary for March of $4,000.The entire amount is under the OASDI limit of $117,000,and thus subject to FICA.His year-to-date pay has already exceeded the $7,000 cap for FUTA and SUTA.Which of the following is a part of the journal entry to record the employer's payroll taxes?

Accepted Answer

A) credit to Payroll Tax Expense 
B) debit to FICA Taxes Payable 
C) credit to FICA-Medicare Taxes Payable 
D) debit to Cash 
A) credit to Payroll Tax Expense 
B) debit to FICA Taxes Payable 
C) credit to FICA-Medicare Taxes Payable 
D) debit to Cash

Question 10

Jason's gross pay for the week is $1,300.His yearly pay is under the limit for OASDI.Assume that the rate for state and federal unemployment compensation taxes is 6% and that Jason's year-to-date pay has not yet exceeded the $7,000 cap.His yearly pay is under the limit for OASDI.What is the total amount of payroll taxes that his employer must record as payroll tax expenses? (Do not round your intermediate calculations.Assume a FICA-OASDI Tax of 6.2% and FICA-Medicare Tax of 1.45%. )

Accepted Answer

A) $73.45 
B) $80.60 
C) $177.45 
D) $159.93 
A) $73.45 
B) $80.60 
C) $177.45 
D) $159.93

Question 11

The amount of income taxes ________.

Accepted Answer

A) required by the federal government for a corporation is calculated on a Form 1120 
B) paid by the corporation,when it files the Form 1120,is recorded as a debit to the Income Tax Expense account and a credit to the Cash account 
C) the corporation owes,but has not yet paid,is recorded as a debit to the Income Tax Payable account 
D) the corporation owes,but has not yet paid,is reported as a long-term liability on the balance sheet 
A) required by the federal government for a corporation is calculated on a Form 1120 
B) paid by the corporation,when it files the Form 1120,is recorded as a debit to the Income Tax Expense account and a credit to the Cash account 
C) the corporation owes,but has not yet paid,is recorded as a debit to the Income Tax Payable account 
D) the corporation owes,but has not yet paid,is reported as a long-term liability on the balance sheet

Question 12

Main Street Restaurant incurred salaries expense of $60,000 for 2016.The payroll expense includes employer FICA tax,in addition to state unemployment tax and federal unemployment tax.Of the total salaries,$17,000 is subject to unemployment tax.Also,the company provides the following benefits for employees: health insurance (cost to the company,$2,500),life insurance (cost to the company,$700),and retirement benefits (cost to the company,10% of salaries expense).Journalize Main Street's expenses for employee benefits and for payroll taxes.Explanations are not required.

Accepted Answer

The answer of Main Street Restaurant incurred salaries expense of...

Question 13

The entry to accrue the warranty payable includes a credit to Warranty Expense.

Accepted Answer

A) True 
 B)False

Question 14

Jumbo Sales Corporation offers warranties on all their electronic goods.Warranty expense is estimated at 3% of sales revenue.In 2017,the company had $610,000 of sales.In the same year,it paid out $9,000 of warranty payments.Which of the following is the entry needed to record the estimated warranty expense?

Accepted Answer

A) 
  
B) 
  
C) 
  
D) 
  
A) 
  
B) 
  
C) 
  
D)

Question 15

On October 1,2017,Carlos,Inc.borrowed $225,000 by signing a nine-month,8% note payable.Interest was accrued on December 31,2017.Prepare the journal entry July,1,2017,the date the note was paid.

Accepted Answer

The answer of On October 1,2017,Carlos,Inc.borrowed $225,000 by signing a...

Question 16

On August 31,2016,Peter Services received $3,500 in advance of performing the service.Which journal entry is needed to record the receipt of cash?

Accepted Answer

A) Debit Unearned Revenue $3,500,and credit Cash $3,500. 
B) Debit Cash $3,500,and credit Service Revenue $3,500. 
C) Debit Unearned Revenue $3,500,and credit Service Revenue $3,500. 
D) Debit Cash $3,500,and credit Unearned Revenue $3,500. 
A) Debit Unearned Revenue $3,500,and credit Cash $3,500. 
B) Debit Cash $3,500,and credit Service Revenue $3,500. 
C) Debit Unearned Revenue $3,500,and credit Service Revenue $3,500. 
D) Debit Cash $3,500,and credit Unearned Revenue $3,500.

Question 17

If the likelihood of a future event is probable and the amounts of the expense cannot be estimated,how should the company report the contingency?

Accepted Answer

Describe the situati

Question 18

Isabelle's gross pay for the week is $960.00.Her deduction for federal income tax is based on a rate of 20%.She has voluntary deductions of $235.00.Her yearly pay is under the limit for OASDI.What is her net pay? (Assume a FICA-OASDI Tax of 6.2% and FICA-Medicare Tax of 1.45%.Do not round any intermediate calculations,and round your final answer to the nearest cent. )

Accepted Answer

A) $533.00 
B) $768.00 
C) $694.56 
D) $459.56 
A) $533.00 
B) $768.00 
C) $694.56 
D) $459.56

Question 19

The times-interest-earned ratios of four companies are given below:
 
Which of the above companies has the highest debt-paying ability?

Accepted Answer

A) Forge Corp. 
B) Fellow,Inc. 
C) Stacy Corp. 
D) Bennett,Inc. 
A) Forge Corp. 
B) Fellow,Inc. 
C) Stacy Corp. 
D) Bennett,Inc.

Question 20

Which of the following would be included in the journal entry to record the payment of sales tax payable?

Accepted Answer

A) a debit to Sales Tax Payable 
B) a credit to Sales Tax Expense 
C) a debit to Sales Tax Expense 
D) a credit to Sales Tax Payable 
A) a debit to Sales Tax Payable 
B) a credit to Sales Tax Expense 
C) a debit to Sales Tax Expense 
D) a credit to Sales Tax Payable

Federal unemployment compensation tax is paid by the employer and is not deducted from an employee's gross earnings.

FICA tax is paid by the employee only.

Northwest,Inc.records indicate that January sales on account were $109,000.The company's management estimates warranty expense to be 3.6% of sales.Prepare the journal entry to record warranty expense.

Investors use the times-interest-earned ratio to evaluate a company's ability to pay interest expense.

It is mandatory for both the employer and employee to pay ________.

Sandstorm,Inc.signed a 200-day,5%,$5,000 note on April 1,2017,and this was the only note payable for the company.Calculate the times-interest-earned ratio of Sandstorm,Inc.if its earnings before interest and taxes for the year ending December 31,2017,is $4,300.(Use a 360-day year. )

The amount of income taxes ________.

The entry to accrue the warranty payable includes a credit to Warranty Expense.

On October 1,2017,Carlos,Inc.borrowed $225,000 by signing a nine-month,8% note payable.Interest was accrued on December 31,2017.Prepare the journal entry July,1,2017,the date the note was paid.

On August 31,2016,Peter Services received $3,500 in advance of performing the service.Which journal entry is needed to record the receipt of cash?

If the likelihood of a future event is probable and the amounts of the expense cannot be estimated,how should the company report the contingency?

The times-interest-earned ratios of four companies are given below: Which of the above companies has the highest debt-paying ability?

Which of the following would be included in the journal entry to record the payment of sales tax payable?

Accounting and the Business Environment

Recording Business Transactions

The Adjusting Process

Completing the Accounting Cycle

Merchandising Operations

Merchandise Inventory

Accounting Information Systems

Internal Control and Cash

Receivables

Plant Assets, natural Resources, and Intangibles

Partnerships

Corporations

Long-Term Liabilities

Investments

The Statement of Cash Flows

Financial Statement Analysis

Introduction to Managerial Accounting

Job Order Costing

Process Costing

Cost-Volume-Profit Analysis

Master Budgets

Flexible Budgets and Standard Cost Systems

Cost Allocation and Responsibility Accounting

Short-Term Business Decisions

Capital Investment Decisions

Filters

Exam 11: Current Liabilities and Payroll

Federal unemployment compensation tax is paid by the employer and is not deducted from an employee's gross earnings.

FICA tax is paid by the employee only.

Northwest,Inc.records indicate that January sales on account were $109,000.The company's management estimates warranty expense to be 3.6% of sales.Prepare the journal entry to record warranty expense.

Investors use the times-interest-earned ratio to evaluate a company's ability to pay interest expense.

It is mandatory for both the employer and employee to pay ________.

Sandstorm,Inc.signed a 200-day,5%,$5,000 note on April 1,2017,and this was the only note payable for the company.Calculate the times-interest-earned ratio of Sandstorm,Inc.if its earnings before interest and taxes for the year ending December 31,2017,is $4,300.(Use a 360-day year. )

The amount of income taxes ________.

The entry to accrue the warranty payable includes a credit to Warranty Expense.

On October 1,2017,Carlos,Inc.borrowed $225,000 by signing a nine-month,8% note payable.Interest was accrued on December 31,2017.Prepare the journal entry July,1,2017,the date the note was paid.

On August 31,2016,Peter Services received $3,500 in advance of performing the service.Which journal entry is needed to record the receipt of cash?

If the likelihood of a future event is probable and the amounts of the expense cannot be estimated,how should the company report the contingency?

The times-interest-earned ratios of four companies are given below: Which of the above companies has the highest debt-paying ability?

Which of the following would be included in the journal entry to record the payment of sales tax payable?

Accounting and the Business Environment

Recording Business Transactions

The Adjusting Process

Completing the Accounting Cycle

Merchandising Operations

Merchandise Inventory

Accounting Information Systems

Internal Control and Cash

Receivables

Plant Assets, natural Resources, and Intangibles

Partnerships

Corporations

Long-Term Liabilities

Investments

The Statement of Cash Flows

Financial Statement Analysis

Introduction to Managerial Accounting

Job Order Costing

Process Costing

Cost-Volume-Profit Analysis

Master Budgets

Flexible Budgets and Standard Cost Systems

Cost Allocation and Responsibility Accounting

Short-Term Business Decisions

Capital Investment Decisions

Filters