Exam 10: Reporting and Interpreting Liabilities

Gross earnings for the pay period are $100,000.Required payroll deductions are: Social Security $6,700; Medicare $1,450; Federal Income tax $18,000 and State income tax $3,850.What is the net pay to employees?

On January 2,2015,AAA Publishing,Inc.received a one-year subscription for $100 to one of the magazines that it publishes.At that time,it debited cash for $100 and credited unearned revenue for $100.After all the magazines have been delivered through December 31,2015,what journal entry needs to be recorded?

During one pay period,your company distributes $130,500 to employees as net pay.The income tax withholdings were $19,000 and the FICA withholdings were $5,000.Total payroll costs to the company for this pay period,excluding any unemployment taxes,was:

The stated rate is the rate used to determine the:

A bond premium:

Which of the following statements best describes a contingent liability?

A negative times interest earned ratio suggests that the company:

Contingent liabilities must be recorded if the:

FICA payments consist of Social Security taxes and Medicare taxes.

The total amount of interest that will be paid on a four-month,$6,500,9% note payable equals:

Company A has liabilities of $6,773,000 and stockholders' equity of $3,647,000 at the end of the current year,and sales revenue of $9,800,000 and net income of $899,080 for the year.Company B has assets of $1,680,000 and stockholders' equity of $978,750 at the end of the current year,and sales revenue of $1,950,000 and net income of $351,000 for the year. Required: Part a.Calculate the debt-to-assets ratio for each company. Part b.Identify the company that has greater financing risk and explain why.

At the maturity date,the carrying value of a bond should always be equal to the face value.

Selected financial information presented below was obtained from the financial statements of the Napa Valley Brewery: What is the debt-to-assets ratio?

On September 1, 2016, a company issued a $50,000, 6-month, 9% note payable to purchase equipment.At December 31, 2016, the company records an adjusting entry to accrue interest incurred by not paid.The company pays the note with interest at the maturity date. -Use the information above to answer the following question.What is the adjusting journal entry at December 31 to record the accrued interest on the note payable?

Texable,Inc.is required to match $45,900 for its portion of FICA and $4,700 for federal and state unemployment taxes.The entry to record Texable's payroll taxes includes:

Your company issues $50,000 of one-year,10% bonds at face value.The journal entry to record this transaction will include a debit to:

The Big Co.issued $100,000 of bonds for their face value six years ago.This year,it retires the bonds for $105,000.As a result of retiring these bonds,it:

Bobby Darling is the only employee of Atlantic Records, Inc.During the first week of January, Darling earned $800 and had federal and state income tax withholdings of $40 and $15, respectively.FICA taxes are 7.65% on earnings up to $117,000.State and federal unemployment taxes for the period are $50 and $8, respectively. -Use the information above to answer the following question.What would be the amount of Darling's payroll check for the first week of January?

Your company issues $500,000 in bonds at a price of 98.The journal entry used to record the issuance will include a debit to:

Accrued liabilities could include all of the following except: