會(huì)計(jì)學(xué)原理23版 英文版題庫(kù)TB-Chap011

CopyrightMcGraw-HillEducation.Allrightsreserved.NoreproductionordistributionwithoutthepriorwrittenconsentofMcGraw-HillEducation.CopyrightMcGraw-HillEducation.Allrightsreserved.NoreproductionordistributionwithoutthepriorwrittenconsentofMcGraw-HillEducation.Chapter11CurrentLiabilitiesandPayrollAccountingMULTIPLECHOICEQUESTIONSAliabilityisaprobablefuturepaymentofassetsorservicesthatacompanyispresentlyobligatedtomakeasaresultofpasttransactionsorevents.TrueFalseObligationsnotduewithinoneyearorthecompany'soperatingcycle,whicheverislonger,arereportedascurrentliabilities.TrueFalseAllexpectedfuturepaymentsareliabilities.TrueFalseAsingleliabilitycannotbedividedbetweencurrentandnoncurrentliabilities.TrueFalseAcompanycannothavealiabilityiftheamountoftheobligationisunknown.TrueFalseAliabilitymayexistevenifthereisuncertaintyaboutwhomtopay,whentopay,orhowmuchtopay.TrueFalseTradeaccountspayableareamountsowedtosuppliersforproductsorservicespurchasedoncredit.TrueFalseUnearnedrevenuesarecurrentliabilities.TrueFalse1SalesTaxesPayableisdebitedandCashiscreditedwhencompaniessendsalestaxescollectedfromcustomerstothegovernment.TrueFalseVacationbenefitsisanexampleofaknownliability.TrueFalseAcontingentliabilityisapotentialobligationthatdependsonafutureeventarisingfromapasttransactionorevent.TrueFalsePayrollisanexampleofacontingentliabilityfortheemployer.TrueFalseThefulldisclosureprinciplerequiresthereportingofcontingentliabilitiesthatarereasonablypossible.TrueFalseUncertaintiesfromthedevelopmentofnewcompetingproductsarenotcontingentliabilities.TrueFalseDebtguaranteesareusuallydisclosedasacontingentliability.TrueFalseAccountingforcontingentliabilitiescoversthreepossibilities:(1)Thefutureeventisprobableandtheamountcannotbereasonablyestimated;(2)Thefutureeventisremoteorunlikelytorecur;(3)Thelikelihoodoftheliabilitytooccurisimpossible.TrueFalse2Apotentiallawsuitclaimisdisclosedwhentheclaimcanbereasonablyestimatedanditisreasonablypossible.TrueFalseAhighvalueforthetimesinterestearnedratiomeansthatacompanyisalowerriskborrower.TrueFalseThetimesinterestearnedratioiscalculatedbydividinginterestexpensebyincomebeforeinterestexpenseandincometaxes.TrueFalseExperienceshowsthatthedefaultrateonliabilitiesincreasessharplywhentimesinterestearnedfallsbelow1.5to2.0andremainsatthatlevelorlowerforseveraltimeperiods.TrueFalseAcompany'sincomebeforeinterestexpenseandtaxesis$250,000anditsinterestexpenseis$100,000.Itstimesinterestearnedratiois2.5.TrueFalseAshort-termnotepayableisawrittenpromisetopayaspecifiedamountonadefinitefuturedatewithinoneyearortheoperatingcycle,whicheverisshorter.TrueFalsePromissorynotescannotbetransferredfrompartytopartybecausetheyarenonnegotiable.TrueFalseAnotepayablecanbeusedtoextendthepaymentdueonanaccountpayable.TrueFalse3Eveniftheendofanaccountingperiodoccursbetweenthesigningofanotepayableanditsmaturitydate,thematchingprinciplerequiresthatinterestexpensenotbeaccruedonapayableuntilthenoteispaid.TrueFalseRequiredpayrolldeductionsincludeincometaxes,SocialSecuritytaxes,pensionandhealthcontributions,uniondues,andcharitablegiving.TrueFalseTheamountoffederalincometaxwithheldfromemployeepaydependsontheemployee'sannualearningsrateandthenumberofwithholdingallowancesclaimedbytheemployee.TrueFalseTheamountofFICAtaxthatemployersmustpayistwicetheamountoftheFICAtaxeswithheldfromtheiremployees.TrueFalseThestateunemploymenttaxratesappliedtoanemployerareadjustedaccordingtoanemployer'smeritrating.TrueFalseAhighmeritratingforstateunemploymenttaxesmeansthatanemployerhashighemployeeturnoverorseasonalhiring.TrueFalseEmployersmustkeepindividualearningsreportsforeachemployee.TrueFalseDepositsofamountspayabletothefederalgovernmentmaybepaidthroughfederaldepositorybanks.TrueFalse4FUTArequiresemployerstopayafederalunemploymenttaxonallsalaryorwagespaidtoeachemployee.TrueFalseTheFormW-2mustbegiventoemployeesbeforeJanuary31followingtheyearcoveredbytheFormW-2.TrueFalsePaymentsofFUTAaremadequarterlytoafederaldepositorybankifthetotalamountdueexceeds$500.TrueFalseAknownobligationofanuncertainamountthatcanatleastbereasonablyestimatedisreportedasanestimatedliability.TrueFalseAccruedvacationbenefitsareaformofestimatedliabilityforanemployer.TrueFalseAliabilityisincurredwhenincomeisearnedbecauseincometaxexpenseiscreatedbyearningincome.TrueFalseAcorporationhasa$40,000creditbalanceintheIncomeTaxPayableaccount.Periodendinformationshowsthattheactualliabilityis$47,000.ThecompanyshouldrecordanentrytoIncomeTaxExpensefor$7,000andcreditIncomeTaxesPayablefor$7,000.TrueFalseEmployerscanuseawagebracketwithholdingtabletocomputefederalincometaxeswithheldfromeachemployee'sgrosspay.TrueFalse5CopyrightMcGraw-HillEducation.Allrightsreserved.NoreproductionordistributionwithoutthepriorwrittenconsentofMcGraw-HillEducation.CopyrightMcGraw-HillEducation.Allrightsreserved.NoreproductionordistributionwithoutthepriorwrittenconsentofMcGraw-HillEducation.CopyrightMcGraw-HillEducation.Allrightsreserved.NoreproductionordistributionwithoutthepriorwrittenconsentofMcGraw-HillEducation.Eachemployeerecordsthenumberofwithholdingallowancesclaimedonthewithholdingallowancecertificatethatisfiledwiththeemployer,whichistheFormW-4.TrueFalseCompanieswithmanyemployeesrarelyuseaspecialpayrollbankaccountfromwhichtopayemployees.TrueFalseThereportthatshowsthepayperioddates,hoursworked,grosspay,deductions,andnetpayofeachemployeeforeverypayperiodisthepayrollregister.TrueFalseAnemployeeearningsreportisacumulativerecordofeachemployee'shoursworked,grossearnings,deductions,andnetpay.TrueFalseWhenthenumberofwithholdingallowancesclaimedonFormW-4increases,theamountofincometaxwithhelddecreases.TrueFalseAllofthefollowingstatementsregardingliabilitiesaretruexcep:Unearnedfuturewagestobepaidtoemployeesshouldberecordedasliabilities.Foraliabilitytobereported,itmustbeapresentobligationthatresultsfromapasttransactionorevent,andrequiresafuturepaymentofassetsorservices.Informationaboutliabilitiesismoreusefulwhenthebalancesheetidentifiesthemaseithercurrentorlongterm.Liabilitiescaninvolveuncertaintyinwhomtopay.Aliabilityisaprobablefuturepaymentofassetsorservices.Obligationstobepaidwithinoneyearorthecompany'soperatingcycle,whicheverislonger,are:Currentassets.Bills.Earnedrevenues.Operatingcycleliabilities.Currentliabilities.6Obligationsnotexpectedtobepaidwithinthelongerofoneyearorthecompany'soperatingcyclearereportedas:Currentliabilities.Long-termliabilities.Bills.Operatingcycleliabilities.Currentassets.Allofthefollowingstatementsregardinguncertaintyinliabilitiesaretruexcep:Liabilitiescaninvolveuncertaintyinwhomtopay.Acompanycanbeawareofanobligationbutnotknowhowmuchwillberequiredtosettleit.Acompanycanhaveanobligationofaknownamounttoaknowncreditorbutnotknowwhenitmustbepaid.Acompanycancreatealiabilitywithaknownamountevenwhentheholderofthenotemaynotbeknownuntilthematuritydate.Acompanyonlyrecordsliabilitieswhenitknowswhomtopay,whentopay,andhowmuchtopay.Inordertobereported,liabilitiesmust:Involveanoutflowofcash.Alwayshaveadefinitedateforpayment.Beforaspecificamount.Sometimesbeestimated.Becertain.Allofthefollowingaretrueofknownliabilitiesexcept:Includeaccountspayable,notespayable,andpayroll.Areobligationssetbyagreements,contracts,orlaws.Maydependonsomefutureeventoccurring.Aredefinitelydeterminable.Aremeasurable.Accountspayableare:Amountsowedtosuppliersforproductsand/orservicespurchasedoncredit.Alwayspayablewithin30days.Long-termliabilities.Estimatedliabilities.Notusuallydueonspecificdates.7Amountsreceivedinadvancefromcustomersforfutureproductsorservices:Areliabilities.Arerevenues.Requireanoutlayofcashinthefuture.ArenotallowedunderGAAP.Increaseincome.Whenacompanyisobligatedforsalestaxespayable,itisreportedasa(n):Businessexpense.Estimatedliability.Currentliability.Long-termliability.Contingentliability.Whichofthefollowingdonotapplytounearnedrevenues?Alsocalledcollectionsinadvance.Amountsreceivedinadvancefromcustomersforfuturedeliveryofproductsorservices.Alsocalledprepayments.Alsocalleddeferredrevenues.Amountstobereceivedinthefuturefromcustomersfordeliveryofproductsorservicesinthecurrentperiod.Ifacompanyhasadvanceticketsalestotaling$2,000,000fortheupcomingfootballseason,thereceiptofcashwouldbejournalizedas:DebitCash,creditUnearnedRevenue.DebitSales,creditUnearnedRevenue.DebitUnearnedRevenue,creditSales.DebitCash,creditTicketsalespayable.DebitUnearnedRevenue,creditCash.Acontingentliabilityis:Anobligationnotrequiringfuturepayment.Alwaysofaspecificamount.Anobligationarisingfromafutureevent.Anobligationarisingfromthepurchaseofgoodsorservicesoncredit.Apotentialobligationthatdependsonafutureeventarisingfromapasttransactionorevent.8Contingentliabilitiesarerecordedordisclosedunlesstheyare:Possibleandestimable.Probableandnotestimable.Probableandestimable.Remote.Reasonablypossible.Contingentliabilitiesmustberecordedif:Thefutureeventisreasonablypossiblebutnotestimable.Theamountowedcannotbereasonablyestimated.Thefutureeventisprobablebutnotestimable.Thefutureeventisremote.Thefutureeventisprobableandtheamountowedcanbereasonablyestimated.Debtguaranteesare:Abadbusinesspractice.Consideredtobecurrentliabilities.Recordedasliabilitieseventhoughitishighlyunlikelythattheoriginaldebtorwilldefault.Consideredtobecontingentliabilities.Neverdisclosedinthefinancialstatements.Intheaccountingrecordsofadefendant,lawsuits:Areestimatedliabilities.Shouldalwaysbedisclosed.Shouldalwaysberecorded.Shouldberecordedifpaymentfordamagesisprobableandtheamountcanbereasonablyestimated.Shouldneverberecorded.Uncertaintiessuchasnaturaldisastersare:Disclosedbecauseoftheirusefulnesstofinancialstatements.Contingentliabilitiesbecausetheyarefutureeventsarisingfrompasttransactionsorevents.Estimatedliabilitiesbecausetheamountsareuncertain.Notcontingentliabilitiesbecausetheyarefutureeventsnotarisingfrompasttransactionsorevents.Reportedinthesamewayasdebtguarantees.9CopyrightMcGraw-HillEducation.Allrightsreserved.NoreproductionordistributionwithoutthepriorwrittenconsentofMcGraw-HillEducation.CopyrightMcGraw-HillEducation.Allrightsreserved.NoreproductionordistributionwithoutthepriorwrittenconsentofMcGraw-HillEducation.CopyrightMcGraw-HillEducation.Allrightsreserved.NoreproductionordistributionwithoutthepriorwrittenconsentofMcGraw-HillEducation.Thetimesinterestearnedratioreflects:Acompany'sabilitytopayinterestevenifsalesdecline.Therelationbetweenassetsandliabilities.Acompany'sabilitytopayitsoperatingexpensesontime.Therelationbetweenincomeanddebt.Acompany'sprofitability.InterestexpenseisLikelytostaythesamewhensaleschange.Afixedexpense.Afactorindeterminingacompany'sborrowingrisk.Incurredoncurrentliabilities.Likelytofluctuatewhensaleschange.Timesinterestearnediscalculatedby:Dividingincomebeforeinterestexpenseandincometaxesbyinterestexpense.Dividinginterestexpensebyincomebeforeinterestexpense.Multiplyinginterestexpensebyincome.Dividingincomebeforeinterestexpensebyinterestexpenseandincometaxes.Multiplyinginterestexpensebyincomebeforeinterestexpense.Ifthetimesinterestearnedratio:Isgreaterthan1.5,thecompanyisindefault.Increases,thenriskdecreases.Isgreaterthan3.0,thecompanyislikelycarryingtoomuchdebt.Increases,thenriskincreases.Islessthan1.5,thecompanyiscarryingtoolittledebt.Acompany'shadfixedinterestexpenseof$5,000,itsincomebeforeinterestexpenseandincometaxesis$17,000,anditsnetincomeis$9,400.Thecompany'stimesinterestearnedratioequals:A)3.4. B)1.8. C)0.5. D)1.9. E)0.3.Thecorrecttimesinterestearnedcomputationis:(Netincome-Interestexpense-Incometaxes)/Interestexpense.(Netincome+Interestexpense-Incometaxes)/Interestexpense.Interestexpense/(Netincome+Interestexpense+Incometaxesexpense).(Netincome-Interestexpense+Incometaxes)/Interestexpense.(Netincome+Interestexpense+Incometaxes)/Interestexpense.10Acompany'sincomebeforeinterestexpenseandincometaxesis$350,000anditsinterestexpenseis$100,000.Itstimesinterestearnedratiois:A)1.75 B)0.29 C)2.50 D)3.50 E)0.50Acompany'sfixedinterestexpenseis$8,000,itsincomebeforeinterestexpenseandincometaxesis$32,000.Itsnetincomeis$9,600.Thecompany'stimesinterestearnedratioequals:A)0.25. B)3.33. C)0.30. D)4.0. E)0.83.Thedifferencebetweentheamountreceivedfromissuinganotepayableandtheamountrepaidatmaturityisreferredtoas:Interest.Principal.AccountsPayable.Cash.FaceValue.Ashort-termnotepayable:Isacontingentliability.Isawrittenpromisetopayaspecifiedamountonadefinitefuturedatewithinoneyearorthecompany'soperatingcycle,whicheverislonger.Isanestimatedliability.Isnotaliabilityuntiltheduedate.Cannotbeusedtoextendthepaymentperiodforanaccountpayable.Short-termnotespayable:Arenotnegotiable.Cannotreplaceanaccountpayable.Areaconditionalpromisetopay.Canbeissuedinreturnformoneyborrowedfromabank.Rarelyinvolveinterestcharges.OnDecember1,VictoriaCompanysigneda90-day,6%notepayable,withafacevalueof$15,000.WhatamountofinterestexpenseisaccruedatDecember31onthenote? (Use360daysyear.)A)$0 B)$300 C)$225 D)$75 E)$90011OnNovember1,AlanCompanysigneda120-day,8%notepayable,withafacevalueof$9,000.WhatistheadjustingentryfortheaccruedinterestatDecember31onthenote? (Use360daysyear.)DebitInterestPayable,$240;creditInterestExpense,$240.DebitInterestExpense,$720;creditInterestPayable,$720.DebitInterestExpense,$120;creditInterestPayable,$120.Debitinterestpayable,$120;creditinterestexpense,$120.Noadjustingentryisrequired.OnNovember1,AlanCompanysigneda120-day,8%notepayable,withafacevalueof$9,000.WhatisthematurityvalueofthenoteonMarch1? (Use360daysayear.)A)$9,120 B)$9,240 C)$9,000 D)$720 E)$9,720OnNovember1,AlanCompanysigneda120-day,8%notepayable,withafacevalueof$9,000.Alanmadetheappropriateyear-endaccrual.WhatisthejournalentryasofMarch1torecordthepaymentofthenoteassumingnoreversingentrywasmade?(Use360daysayear.)DebitNotesPayable$9,240;creditInterestPayable$120;creditInterestExpense$120;creditCash$9,000.DebitNotesPayable$9,000;debitInterestPayable$120;creditCash$9,120.DebitNotesPayable$9,000;debitInterestExpense$240;creditCash$9,240.DebitNotesPayable$9,000;debitInterestPayable$120;debitInterestExpense$120;creditCash$9,240.DebitCash$9,240;creditNotesPayable$9,240.Employers'responsibilitiesforpayrolldonotinclude:RecordinganexpensefortheemployeeFederalIncomeTaxwithholding.FilingForm941,theEmployer'sQuarterlyFederalTaxReturn.ProvidingeachemployeewithanannualreportofhisorherwagessubjecttoFICAandfederalincometaxesalongwiththeamountofthesetaxeswithheld.Maintainingindividualearningsrecordsforeachemployee.FilingForm940,theAnnualFederalUnemploymentTaxReturn.Grosspayis:Totalcompensationearnedbyanemployeebeforeanydeductions.Salariesaftertaxesarededucted.Deductionswithheldbyanemployer.Theamountofthepaycheck.Take-homepay.12Theemployershouldrecorddeductionsfromemployeepayas:Employeereceivables.Employeepayables.Payrolltaxes.Currentliabilities.Wagespayable.FICAtaxesinclude:Charitablegiving.Employeefederalincometax.SocialSecurityandMedicaretaxes.Employeestateincometax.Federalandstateunemploymenttaxes.Theamountoffederalincometaxeswithheldfromanemployee'spaycheckisdeterminedby:Theamountofsocialsecuritytaxeswithheld.Multiplyingthegrosspayby6.2%.Taxtablesprovidedbythestateinwhichtheemployeeworks.Theemployer'smeritrating.Currentearningsforthepayperiodandnumberofwithholdingallowancestheemployeeclaims.Recordingemployeepayrolldeductionsmayinvolve:Expensesforthegrosswagesandsalaries.Liabilitiestotheemployer.Liabilitiestofederalandstategovernments.Expensesforstateunemployment.Expensesfortheemployerportionofanymedicalinsurance.TheFederalInsuranceContributionsAct(FICA)requiresthateachemployerfilea:W-2.Form1040.W-4.Form941.Form1099.Anemployeeearned$37,000duringtheyearworkingforanemployerwhenthemaximumlimitforSocialSecuritywas$118,500.TheFICAtaxrateforSocialSecurityis6.2%andtheFICAtaxrateforMedicareis1.45%.Theemployee'sannualFICAtaxesamountis:A)$2,830.50. B)$1,757.50. C)$8,950.50. D)$536.50. E)$2,294.00.13PortiaGrantisanemployeewhoispaidmonthly.ForthemonthofJanuaryofthecurrentyear,sheearnedatotalof$8,260.TheFICAtaxforsocialsecurityis6.2%ofthefirst$118,500ofemployeeearningseachcalendaryearandtheFICAtaxrateforMedicareis1.45%ofallearnings.TheFUTAtaxrateof.6%andtheSUTAtaxrateof5.4%areappliedtothefirst$7,000ofanemployee'spay.Theamountoffederalincometaxwithheldfromherearningswas$1,325.17.Hernetpayforthemonthis:(Roundyourintermediatecalculationstotwodecimalplaces.)A)$6,422.71 B)$5,868.94 C)$6,246.94 D)$6,302.94 E)$7,194.11PortiaGrantisanemployeewhoispaidmonthly.ForthemonthofJanuaryofthecurrentyear,sheearnedatotalof$8,260.TheFICAtaxforsocialsecurityis6.2%ofthefirst$118,500earnedeachcalendaryearandtheFICAtaxrateforMedicareis1.45%ofallearnings.TheFUTAtaxrateof0.6%andtheSUTAtaxrateof5.4%areappliedtothefirst$7,000ofanemployee'spay.Theamountoffederalincometaxwithheldfromherearningswas$1,325.17.WhatisthetotalamountoftaxeswithheldfromthePortia'searnings?(Roundyourintermediatecalculationstotwodecimalplaces.)A)$1,957.06 B)$1,722.00 C)$3,097.17 D)$2,443.21 E)$1,495.36TreyMorganisanemployeewhoispaidmonthly.ForthemonthofJanuaryofthecurrentyear,heearnedatotalof$4,538.TheFICAtaxforsocialsecurityis6.2%ofthefirst$118,500earnedeachcalendaryear,andtheFICAtaxrateforMedicareis1.45%ofallearningsforboththeemployeeandtheemployer.Theamountoffederalincometaxwithheldfromhisearningswas$680.70.Hisnetpayforthemonthis:A)$3,162.98 B)$4,190.84 C)$3,857.30 D)$3,510.14 E)$4,538.00TreyMorganisanemployeewhoispaidmonthly.ForthemonthofJanuaryofthecurrentyear,heearnedatotalof$4,538.TheFICAtaxforsocialsecurityis6.2%ofthefirst$118,500earnedeachcalendaryear,andtheFICAtaxrateforMedicareis1.45%ofallearningsforboththeemployeeandtheemployer.Theamountoffederalincometaxwithheldfromhisearningswas$680.70.WhatisthetotalamountoftaxeswithheldfromtheTrey'searnings?A)$1,027.86 B)$680.70 C)$1,375.02 D)$746.50 E)$962.06TheannualFederalUnemploymentTaxReturnis:FormW-4.FormW-2.Form104.Form940.Form1099.14TheWageandTaxStatementgiventoeachemployeeannuallyis:FormW-4.Form1040.FormW-2.Form941.Form940.Abankthatisauthorizedtoacceptdepositsofamountspayabletothefederalgovernmentisa:FederalReserveBank.Federaldepositorybank.Nationalbank.FDICinsuredbank.Creditunion.Anemployer'sfederalunemploymenttaxes(FUTA)arereported:Semiannually.Annually.Monthly.Weekly.Quarterly.Theratethatastateassignsreflectingacompany'sstabilityorinstabilityinemployingworkersisthe:Payrate.Taxwithholdingrate.FICArate.Creditrating.Meritrating.Employerpayrolltaxes:Arepayableforuptoamaximum$117,000ofemployeeearnings.Arepaidbytheemployee.Areaddedexpensesbeyondthatforthewagesandsalariesearnedbyemployees.Representthesocialsecuritytaxeswithheldfromemployees.Representthefederaltaxeswithheldfromemployees.15AllofthefollowingareemployerpayrollFederalincometaxequaltothatwithheldfromemployees.Medicaretaxequaltothatwithheldfromemployees.Stateunemploymenttax.SocialSecuritytaxequaltothatwithheldfromemployees.Federalunemploymenttax.FUTAtaxesare:SocialSecuritytaxes.Employeeincometaxes.Medicaretaxes.Unemploymenttaxes.Employeedeductions.Whichofthefollowingisnottrueregardingtheunemploymentinsuranceprogram?Itprovidesunemploymentbenefitstoqualifiedworkers.Itadjustsratespaidbyemployersbasedontheirmeritrating.Itisadministeredbyeachstate.Itrequireswithholdingfromtheemployeewages.Itisajointfederalandstateprogram.ThecurrentFUTAtaxrateis0.6%,andtheSUTAtaxrateis5.4%.Bothtaxesareappliedtothefirst$7,000ofanemployee'spay.Assumethatanemployeeearnedtotalwagesof$9,900.Whatistheamountoftotalunemploymenttaxestheemployermustpayonthisemployee'swages?A)$534.60. B)$594.00. C)$0.00. D)$420.00. E)$336.00.ThecurrentFUTAtaxrateis0.6%,andtheSUTAtaxrateis5.4%.Bothtaxesareappliedtothefirst$7,000ofanemployee'spay.Assumethatanemployeeearnedtotalwagesof$2,900inthecurrentperiodandhadcumulativepayforpriorperiodsof$5,800.Whatistheamountofunemploymenttaxestheemployermustpayonthisemployee'swagesforthecurrentperiod?A)$174.00. B)$0.00. C)$348.00. D)$420.00. E)$72.00.Anemployeeearned$43,300workingforanemployerinthecurrentyear.ThecurrentrateforFICASocialSecurityis6.2%payableonearningsupto$118,500maximumperyearandtherateforFICAMedicare1.45%.Theemployer'stotalFICApayrolltaxforthisemployeeis:A)$3,312.45.B)$5,638.05.C)$8,950.50.D)$2,684.60.E)$0,sincetheFICAtaxisonlydeductedfromanemployee'spay.16Anemployeeearned$128,500workingforanemployerinthecurrentyear.ThecurrentrateforFICASocialSecurityis6.2%payableonearningsupto$118,500maximumperyearandtherateforFICAMedicare1.45%ofallearnings.Theemployer'stotalFICApayrolltaxforthisemployeeis:A)$9,210.25.B)$9,830.25.C)$8,950.50.D)$879.75.E)$0,sincetheFICAtaxisonlydeductedfromanemployee'spay.Anemployeeearned$62,500duringtheyearworkingforanemployer.TheFICAtaxrateforSocialSecurityis6.2%ofthefirst$118,500ofemployeeearningspercalendaryearandthetaxrateforMedicareis1.45%ofallearnings.ThecurrentFUTAtaxrateis0.6%,andtheSUTAtaxrateis5.4%.Bothunemploymenttaxesareappliedtothefirst$7,000ofanemployee'spay.Whatistheamountoftotalunemploymenttaxestheemployeemustpay?A)$434.00 B)$56.00 C)$378.00 D)$0.00 E)$101.50GaryMarksispaidonamonthlybasis.ForthemonthofJanuaryofthecurrentyear,heearnedatotalof$8,288.FICAtaxforSocialSecurityis6.2%onthefirst$118,500ofearningseachcalendaryearandtheFICAtaxforMedicareis1.45%ofallearnings.TheFUTAtaxrateis0.6%,andtheSUTAtaxrateis5.4%.Bothunemploymenttaxesareappliedtothefirst$7,000ofanemployee'spay.TheamountofFederalIncomeTaxwithheldfromhisearningswas$1,375.17.Whatistheamountoftheemployer'spayrolltaxesexpensesforthisemployee? (Roundyourintermediatecalculationstotwodecimalplaces.)A)$420.00 B)$2,009.21 C)$2,506.48 D)$1,131.31 E)$1,054.04TristonValeispaidonamonthlybasis.ForthemonthofJanuaryofthecurrentyear,heearnedatotalof$5,210.FICAtaxforSocialSecurityis6.2%onthefirst$118,500ofearningseachcalendaryearandtheFICAtaxforMedicareis1.45%ofallearnings.TheFUTAtaxrateis0.6%,andtheSUTAtaxrateis5.4%.Bothunemploymenttaxesareappliedtothefirst$7,000ofanemployee'spay.TheamountofFederalIncomeTaxwithheldfromhisearningswas$885.70.istheamountoftheemployer'spayrolltaxesexpensesforthisemployee?A)$1,284.27 B)$398.57 C)$711.17 D)$312.60 E)$1,596.87Anestimatedliability:Isaliabilitythatmayoccurifafutureeventoccurs.Isnotrecordeduntiltheamountisknownforcertain.Canbetheresultofalawsuit.Isanunknownliabilityofacertainamount.Isaknownobligationofanuncertainamountthatcanbereasonablyestimated.17CopyrightMcGraw-HillEducation.Allrightsreserved.NoreproductionordistributionwithoutthepriorwrittenconsentofMcGraw-HillEducation.CopyrightMcGraw-HillEducation.Allrightsreserved.NoreproductionordistributionwithoutthepriorwrittenconsentofMcGraw-HillEducation.CopyrightMcGraw-HillEducation.Allrightsreserved.NoreproductionordistributionwithoutthepriorwrittenconsentofMcGraw-HillEducation.Estimatedliabilitiescommonlyarisefromallofthefollowingexcept:Vacationbenefits.Warranties.Incometaxes.Employeebenefits.Unearnedrevenues.Employeesearnvacationpayattherateofonedaypermonth.DuringthemonthofJuly,25employeesqualifyforonevacationdayeach.Theiraveragedailywageis$100perday.WhatistheamountofvacationbenefitexpensetoberecordedforthemonthofJuly?A)$25,000 B)$250 C)$2,500 D)$25 E)$100Employeesearnvacationpayattherateofonedaypermonth.DuringthemonthofJune,10employeesqualifyforonevacationdayeach.Theiraveragedailywageis$150perday.WhichofthefollowingisthenecessaryadjustingjournalentrytorecordtheJunevacationbenefits?DebitPayrollTaxExpense$1,500;creditPayrollTaxesPayable$1,500.DebitPrepaidVacationBenefits$1,500;creditVacationBenefitsPayable$1,500.DebitVacationBenefitsExpense$1,500;creditVacationBenefitsPayable$1,500.DebitVacationBenefitsPayable;creditVacationBenefitsExpense$1,500.DebitVacationBenefitsExpense$1,500;creditPrepaidVacationBenefits$1,500.Employeevacationbenefits:Increasenetincome.Arerecordedasanexpensewhentheemployeeretires.Areestimatedliabilities.Arecontingentliabilities.Arerecordedasanexpensewhentheemployeetakesavacation.Acompanysold$12,000worthofbicycleswithanextendedwarranty.Thecompany'sexperienceisthatwarrantyexpenseaverages2%ofsales.Thecompanyshould:Considerthewarrantyexpensearemoteliabilitysincetherateisonly2%.Recognizewarrantyexpenseandliabilityintheyearofthesale.Considerthewarrantyexpenseacontingentliability.Recognizewarrantyexpenseatthetimethewarrantyworkisperformed.Recognizewarrantyliabilitywhenthecompanypurchasesthebicycles.18Acompanysold$12,000worthofbicycleswithanextendedwarranty.Thecompany'sexperienceisthatwarrantyexpenseaverages2%ofsales.Thecurrentperiod'sentrytorecordthewarrantyexpenseis:DebitPrepaidWarranties$240;creditWarrantyExpense$240.DebitSalesAllowances$240;creditEstimatedWarrantyLiability$240.DebitEstimatedWarrantyLiability$240;creditCash$240.DebitWarrantyExpense$240;creditCash$240.DebitWarrantyExpense$240;creditEstimatedWarrantyLiability$240.Thedeferredincometaxliability:Isacontingentliability.Canresultinadeferredincometaxasset.Isrecordedwhetherornotthedifferencebetweentaxableincomeandfinancialaccountingincomeispermanentortemporary.Isneverrecorded.Resultsfromtheincometaxexpensereportedontheincomestatementdifferingfromamountofincometaxespayabletothegovernment.Acompanyestimatesthatwarrantyexpensewillbe4%ofsales.Thecompany'ssalesforthecurrentperiodare$185,000.Thecurrentperiod'sentrytorecordthewarrantyexpenseis:DebitEstimatedWarrantyLiability$7,400;creditWarrantyExpense$7,400DebitWarrantyExpense$7,400;creditSales$7,400.DebitWarrantyExpense$7,400;creditEstimatedWarrantyLiability$7,400.DebitEstimatedWarrantyLiability$7,400;creditCash$7,400.Noentryisrecordeduntiltheitemsarereturnedforwarrantyrepairs.Acompanyhasasellingpriceof$1,800eachforitsprinters.Eachprinterhasa2yearwarrantythatcoversreplacementofdefectiveparts.Itisestimatedthat2%ofallprinterssoldwillbereturnedunderthewarrantyatanaveragecostof$150each.DuringNovember,thecompany30,000printers,and400printerswereservicedunderthewarrantyatatotalcostof$55,000.ThebalanceintheEstimatedWarrantyLiabilityaccountatNovember1was$29,000.Whatisthecompany'swarrantyexpenseforthemonthofNovember?A)$60,000 B)$55,000 C)$45,000 D)$26,000 E)$90,00019SpringfieldCompanyoffersabonusplantoitsemployeesandtheamountoftheemployeebonusesforthecurrentyearisestimatedtobe$32,500tobepaidduringJanuaryofthefollowingyear.ThejournalentryonDecember31torecordthebonusesis:DebitUnearnedBonuses$32,500;creditBonusPayable$32,500.NoentrysincethebonusesarenotpaiduntilJanuary.DebitEmployeeBonusExpense$32,500;creditPrepaidEmployeeBonus$32,500.DebitEstimatedBonusPayable$32,500;creditCash$32,500.DebitEmployeeBonusExpense$32,500;creditBonusPayable$32,500.Apayrollregisterdoesnotinclude:Hoursworked.Deductions.Payperioddates.Prioryear'searningsGrosspayandnetpay.Thewagebracketwithholdingtableisusedto:ComputeMedicarewithholding.Computeunemploymenttaxes.PreparetheW-4.Computesocialsecuritywithholding.Computefederalincometaxwithholding.Atablethatshowstheamountoffederalincometaxtobewithheldfromanemployee'spayisthe:W-4.Form941.Wagebracketwi