Question 1

Which of the following forms is typically given to employees at the end of the calendar year so that employees can file their individual income tax forms?

Accepted Answer

A)  Employee's Withholding Allowance Certificate (W-4) 
B)  Wage and Tax Statement (Form W-2) 
C)  Employer's Quarterly Federal Tax Return (Form 941) 
D)  401k plans 
A)  Employee's Withholding Allowance Certificate (W-4) 
B)  Wage and Tax Statement (Form W-2) 
C)  Employer's Quarterly Federal Tax Return (Form 941) 
D)  401k plans

Question 2

A loan in which the lender deducts interest from the amount borrowed before the money is advanced to the borrower is called an interest bearing note.

Accepted Answer

A) True 
 B)False

Question 3

Each year there is a ceiling for the amount that is subject to all of the following except

Accepted Answer

A)  social security tax 
B)  federal income tax 
C)  federal unemployment tax 
D)  state unemployment tax 
A)  social security tax 
B)  federal income tax 
C)  federal unemployment tax 
D)  state unemployment tax

Question 4

Florida Keys Construction installs swimming pools. They calculate that warranty obligations are 3% of gross sales. For the year just ending Florida Keys' gross sales were $1,450,000. Due to previous quarter recognitions, the Warranty Liability account has a credit balance of $28,700. Determine the year's total warranty liability and journalize any necessary value to establish the year's liability at December 31st.

Accepted Answer

Due to sales, $1,450,000, warr

Question 5

The Core Company had the following assets and liabilities as of December 31, 2012:
   Calculate: Current Ratio, Working Capital and Quick Ratio

Accepted Answer

Current Ratio: ($58,000 + $25,

Question 6

On January 5, 2014, Garrett Company, a calendar-year company, issued $1,000,000 of notes payable, of which $200,000 is due on January 1 for each of the next five years. The proper balance sheet presentation on December 31, 2014, is

Accepted Answer

A)  Current Liabilities, $1,000,000. 
B)  Current Liabilities, $200,000; Long-term Debt, $800,000. 
C)  Long-term Debt, $1,000,000 
D)  Current Liabilities, $800,000; Long-term Debt, $200,000. 
A)  Current Liabilities, $1,000,000. 
B)  Current Liabilities, $200,000; Long-term Debt, $800,000. 
C)  Long-term Debt, $1,000,000 
D)  Current Liabilities, $800,000; Long-term Debt, $200,000.

Question 7

Assume that social security taxes are payable at a 6% rate on the first $100,000 of earnings and Medicare taxes are payable at a 1.5% rate with no maximum earnings, and that federal and state unemployment compensation taxes total 4.6% on the first $7,000 of earnings. If an employee, George Jones, earns $2,500 for the current week and Jones' year-to-date earnings before this week were $6,800, what is the total payroll taxes related to the current week?

Accepted Answer

A)  $187.50 
B)  $196.70 
C)  $344.50 
D)  $9.20 
A)  $187.50 
B)  $196.70 
C)  $344.50 
D)  $9.20

Question 8

During the first year of operations, employees earned vacation pay of $35,000. The vacations will be taken during the second year. The vacation pay expense should be recorded in the second year as the vacations are taken by the employees.

Accepted Answer

A) True 
 B)False

Question 9

Dixon Sales has seven sales employees which receive weekly paychecks. Each earns $10.25 per hour and each has worked 40 hours in the pay period. Each employee pays 12% of gross in Federal Income Tax, 3% in State Income Tax, 6% of gross in Social Security Tax, 1.5% of gross in Medicare Tax, and 1/2% in State Disability Insurance. Journalize the recognition of the pay period ending January 19th which will be paid to the employees January 26th. (Keep in mind that none of the employees is subject to a ceiling amount for social security.)

Accepted Answer

The answer of Dixon Sales has seven sales employees which...

Question 10

Taxes deducted from an employee's earnings to finance social security and Medicare benefits are called FICA taxes.

Accepted Answer

A) True 
 B)False

Question 11

Chang Co. issued a $50,000, 120-day, discounted note to Guarantee Bank. The discount rate is 6%. Assuming a 360-day year, the cash proceeds to Chang Co. are

Accepted Answer

A)  $49,750 
B)  $47,000 
C)  $49,000 
D)  $51,000 
A)  $49,750 
B)  $47,000 
C)  $49,000 
D)  $51,000

Question 12

Use the following information to answer the following questions. The following totals for the month of April were taken from the payroll register of Magnum Company.
  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

Question 13

For Company A and Company B:

Accepted Answer

The answer of For Company A and Company B:
 ...

Question 14

Most employers are required to withhold from employees which of the following employment taxes?

Accepted Answer

A)  FICA tax 
B)  FICA tax, state and federal unemployment compensation tax 
C)  only state unemployment compensation tax 
D)  only federal unemployment compensation tax 
A)  FICA tax 
B)  FICA tax, state and federal unemployment compensation tax 
C)  only state unemployment compensation tax 
D)  only federal unemployment compensation tax

Question 15

On June 8, Alton Co. issued an $80,000, 6%, 120-day note payable on an overdue account payable to Seller Co. Assume that the fiscal year of Alton Co. ends June 30. Which of the following relationships is true?

Accepted Answer

A)  Alton is the creditor and credits Accounts Receivable 
B)  Seller is the creditor and debits Accounts Receivable 
C)  Seller is the borrower and credits Accounts Payable 
D)  Alton is the borrower and debits Accounts Payable 
A)  Alton is the creditor and credits Accounts Receivable 
B)  Seller is the creditor and debits Accounts Receivable 
C)  Seller is the borrower and credits Accounts Payable 
D)  Alton is the borrower and debits Accounts Payable

Question 16

Journalize the following entries on the books of the borrower and creditor. Label accordingly. (Assume a 360-day year is used for interest calculations.)

Accepted Answer

The answer of Journalize the following entries on the books...

Question 17

The summary of the payroll for the monthly pay period ending July 15 indicated the following:
   Journalize the entries to record (a) the payroll and (b) the employer's payroll tax expense for the month. The state unemployment tax rate is 3.1%, and the federal unemployment tax rate is 0.8%. Only $25,000 of salaries are subject to unemployment taxes.

Accepted Answer

The answer of The summary of the payroll for the...

Question 18

Estimating and recording product warranty expense in the period of the sale best follows which of the following accounting concepts?

Accepted Answer

A)  cost concept 
B)  business entity concept 
C)  matching concept 
D)  materiality concept 
A)  cost concept 
B)  business entity concept 
C)  matching concept 
D)  materiality concept

Question 19

Medicare taxes are paid by both the employee and the employer.

Accepted Answer

A) True 
 B)False

Question 20

A defined contribution plan promises employees a fixed annual pension benefit.

Accepted Answer

A) True 
 B)False

Exam 10: Current Liabilities and Payroll

Which of the following forms is typically given to employees at the end of the calendar year so that employees can file their individual income tax forms?

A loan in which the lender deducts interest from the amount borrowed before the money is advanced to the borrower is called an interest bearing note.

Each year there is a ceiling for the amount that is subject to all of the following except

The Core Company had the following assets and liabilities as of December 31, 2012: Calculate: Current Ratio, Working Capital and Quick Ratio

On January 5, 2014, Garrett Company, a calendar-year company, issued $1,000,000 of notes payable, of which $200,000 is due on January 1 for each of the next five years. The proper balance sheet presentation on December 31, 2014, is

During the first year of operations, employees earned vacation pay of $35,000. The vacations will be taken during the second year. The vacation pay expense should be recorded in the second year as the vacations are taken by the employees.

Taxes deducted from an employee's earnings to finance social security and Medicare benefits are called FICA taxes.

Chang Co. issued a $50,000, 120-day, discounted note to Guarantee Bank. The discount rate is 6%. Assuming a 360-day year, the cash proceeds to Chang Co. are

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

For Company A and Company B:

Most employers are required to withhold from employees which of the following employment taxes?

On June 8, Alton Co. issued an $80,000, 6%, 120-day note payable on an overdue account payable to Seller Co. Assume that the fiscal year of Alton Co. ends June 30. Which of the following relationships is true?

Journalize the following entries on the books of the borrower and creditor. Label accordingly. (Assume a 360-day year is used for interest calculations.)

Estimating and recording product warranty expense in the period of the sale best follows which of the following accounting concepts?

Medicare taxes are paid by both the employee and the employer.

A defined contribution plan promises employees a fixed annual pension benefit.

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 and Product Pricing

Capital Investment Analysis

Cost Allocation and Activity-Based Costing

Cost Management for Just-In-Time Environments

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