Exam 9: Appendix

The general rule for posting is that the controlling account is debited periodically for an amount equal to the sum of the debits to the subsidiary ledger, and is creditedperiodically for an amount equal to the sum of the credits to the subsidiary ledger.

The Sales Journal is used for

The use of an Accounts Payable controlling account

The same form is used to report both the employer share of payroll taxes and employee income taxes withheld.

Most employers promise and grant their employees an annual paid vacation

C Company has 7 employees who earned a total of $21,000 in March ($3,000 each).CPP deductions are 4.95% paid by the employees and 4.95% paid by the employer. Income tax withholdings amount to $4,500. The employee EI rate is 1.88%. Thetake-home pay of the 7 employees for March is:

To check for accuracy after posting: first a trial balance is completed, then the subsidiary ledgers are tested by preparing a schedule of the controlling account.

Describe the posting process for special journals

A subsidiary ledger

Because accounting information systems are so accurate, decision makers in practice do not need to have a basic knowledge of how the systems work.

A Payroll Register is a record for a pay period that shows the pay period dates and the hours worked, gross pay, deductions, and net pay of each employee.

Source documents are a group of components that collect and process raw financial data into timely, accurate, relevant, and cost-effective information to meet the purposes of internal and external users.

To account for vacation pay, an employer should estimate the amount to be paid and record it as an expense of the weeks during which the employees are working andearning the vacation time.

Most employers engaged in employing workers must pay

Prepare a Cash Disbursements Journal for Dina Company and journalize the appropriate transactions.

A payroll deduction required by the federal government and used to pay the cost of the employment insurance programs is called:

M Company's 24 sales employees earned salaries of $20,000 during the week ofFebruary 1-6, all of which were subject to 4.95% CPP, and 3 weeks' annual vacation. The salaries are also subject to federal and provincial income tax withholdings of$3,500. M Company's employees also pay EI at the rate of 1.88%, and M Company'sshare is 1.4 times the employees' contributions. Which one of the following entries should be prepared to record M Company's payroll benefits expense?

Employment Insurance is withheld from employees' wages at the rate of 1.83% on only the first $100 earned weekly.

Trekking Company uses a perpetual inventory system and four special journals: Purchases, Sales, Cash Receipts, and Cash Disbursements. The following transactions were incurred during August: Record the above transactions in the appropriate journals that follow. Ignore any transactions that should not be posted to the journals provided.

In a perpetual inventory system