Question 1

A payroll register usually shows the pay period dates,hours worked,gross pay,deductions and net pay of each employee for every pay period.

Accepted Answer

A) True 
 B)False  True

Question 2

When there is little uncertainty surrounding current liabilities,both GAAP and IFRS require companies to record them in a similar manner.

Accepted Answer

A) True 
 B)False  True

Question 3

Describe how to account for and report on contingent liabilities.

Accepted Answer

If an uncertain obligation depends on a probable future event arising from a past transaction and the amount is reasonably estimated,the payment is recorded as a liability.If the future event is remote,the item is not recorded or disclosed.If the future event is reasonably possible,the information about the contingent liability is disclosed in the notes to the financial statements.

Question 4

Amounts received in advance from customers for future products or services:

Accepted Answer

A) Are revenues 
B) Increase income 
C) Are liabilities 
D) Are not allowed under GAAP 
E) Require an outlay of cash in the future 
A) Are revenues 
B) Increase income 
C) Are liabilities 
D) Are not allowed under GAAP 
E) Require an outlay of cash in the future

Question 5

If Steve Company paid $350,000 in bonuses,and net income prior to the bonus was $4,200,000,what was the bonus percentage offered to the employees during 2010?

Accepted Answer

A) 6.2% 
B) 5.7% 
C) 9.1% 
D) 8.3% 
E) 6.8% 
A) 6.2% 
B) 5.7% 
C) 9.1% 
D) 8.3% 
E) 6.8%

Question 6

Debt guarantees are not disclosed because the guarantor is not the primary debtor.

Accepted Answer

A) True 
 B)False

Question 7

A single liability can be divided between current and noncurrent liabilities.

Accepted Answer

A) True 
 B)False

Question 8

Uncertainties from the development of new competing products are contingent liabilities.

Accepted Answer

A) True 
 B)False

Question 9

The amount of federal income taxes withheld from an employee's paycheck is determined by:

Accepted Answer

A) The employee's annual earnings rate and number of withholding allowances 
B) The employer's merit rating 
C) The amount of social security taxes 
D) Multiplying the gross pay by 6.2% 
E) The employee's credit rating 
A) The employee's annual earnings rate and number of withholding allowances 
B) The employer's merit rating 
C) The amount of social security taxes 
D) Multiplying the gross pay by 6.2% 
E) The employee's credit rating

Question 10

A short-term note payable is a written promise to pay a specified amount on a definite future date within one year or the operating cycle,whichever is longer.

Accepted Answer

A) True 
 B)False

Question 11

Times interest earned is calculated by:

Accepted Answer

A) Multiplying interest expense times income 
B) Dividing interest expense by income before interest expense 
C) Dividing income before interest expense and any income tax by interest expense 
D) Dividing interest and income tax expense by income before interest and income tax expense 
E) Dividing income before interest expense by interest expense and income taxes 
A) Multiplying interest expense times income 
B) Dividing interest expense by income before interest expense 
C) Dividing income before interest expense and any income tax by interest expense 
D) Dividing interest and income tax expense by income before interest and income tax expense 
E) Dividing income before interest expense by interest expense and income taxes

Question 12

Promissory notes are nonnegotiable,which means they cannot be transferred from party to party.

Accepted Answer

A) True 
 B)False

Question 13

If Jefferson Company paid a bonus equal to 8% of net income after bonuses and the total bonus distributed was $420,000,how much was net income for the year?

Accepted Answer

A) $5,250,000 
B) $5,670,000 
C) $6,250,000 
D) $4,320,000 
E) $4,875,000 
A) $5,250,000 
B) $5,670,000 
C) $6,250,000 
D) $4,320,000 
E) $4,875,000

Question 14

If a company had net income of $3,003,000,interest expense of $400,000,a tax rate of 40%,and operating income of $5,405,000,what would the times interest earned ratio be for the company?

Accepted Answer

5,405,000

Question 15

Match between columns
                        Premises:  A table of amounts of income tax to be withheld from employees' wages
 A potential obligation that depends on a future event arising from a past transaction
 A seller's obligation to repair or replace a product or service that fails to perform as expected within a specified period
 Obligations of a company not requiring payment within one year or the operating cycle, whichever is longer
 Known obligations of an uncertain amount that can be reasonably estimated
 A number that is used to reduce the amount of federal income tax withheld from an employee's pay
 A rating assigned to an employer by a state based on the employer's past record regarding stable employment
 Payroll taxes on employers assessed by the federal government to support the federal unemployment insurance program
 Gross pay less all deductions
 Taxes assessed on both employer and employees under the Federal Insurance Contributions Act. These taxes fund Social Security and Medicare

Accepted Answer

The Answer of Merit rating and FICA taxes and Estimated is...

Question 16

On November 1,2009,Bob's Skateboards Store signed a $12,000,3-month,5% note payable to cover a past due account payable.
a. What amount of interest expense on this note should Bob's Skateboards Store report?
b. Prepare Bob's general journal entry to record the issuance of the note payable
c. Prepare Bob's general journal entry to record the payment of the note on February 1, 2010.

Accepted Answer

a.Interest expense = $12,000 x 0.05 x 2/

Question 17

An employee earned $47,000 during the year working for an employer.The FICA tax for social security is 6.2% and the FICA tax for Medicare is 1.45%.The employee's share of FICA taxes is:

Accepted Answer

A) $681.50 
B) $2,914.00 
C) $3,595.50 
D) $7,191.00 
E) Zero,since the employee's pay exceeds the FICA limit 
A) $681.50 
B) $2,914.00 
C) $3,595.50 
D) $7,191.00 
E) Zero,since the employee's pay exceeds the FICA limit

Question 18

An estimated liability is a known obligation of an uncertain amount that can at least be reasonably estimated.

Accepted Answer

A) True 
 B)False

Question 19

Unearned revenue is initially recognized with a:

Accepted Answer

A) Credit to unearned revenue 
B) Credit to revenue 
C) Debit to revenue payable 
D) Debit to revenue 
E) Debit to unearned revenue 
A) Credit to unearned revenue 
B) Credit to revenue 
C) Debit to revenue payable 
D) Debit to revenue 
E) Debit to unearned revenue

Question 20

The amount of federal income tax withheld is based on the employee's annual earnings rate plus the number of withholding allowances claimed by the employee.

Accepted Answer

A) True 
 B)False

A payroll register usually shows the pay period dates,hours worked,gross pay,deductions and net pay of each employee for every pay period.

When there is little uncertainty surrounding current liabilities,both GAAP and IFRS require companies to record them in a similar manner.

Describe how to account for and report on contingent liabilities.

Amounts received in advance from customers for future products or services:

If Steve Company paid $350,000 in bonuses,and net income prior to the bonus was $4,200,000,what was the bonus percentage offered to the employees during 2010?

Debt guarantees are not disclosed because the guarantor is not the primary debtor.

A single liability can be divided between current and noncurrent liabilities.

Uncertainties from the development of new competing products are contingent liabilities.

The amount of federal income taxes withheld from an employee's paycheck is determined by:

A short-term note payable is a written promise to pay a specified amount on a definite future date within one year or the operating cycle,whichever is longer.

Times interest earned is calculated by:

Promissory notes are nonnegotiable,which means they cannot be transferred from party to party.

If Jefferson Company paid a bonus equal to 8% of net income after bonuses and the total bonus distributed was $420,000,how much was net income for the year?

If a company had net income of $3,003,000,interest expense of $400,000,a tax rate of 40%,and operating income of $5,405,000,what would the times interest earned ratio be for the company?

An employee earned $47,000 during the year working for an employer.The FICA tax for social security is 6.2% and the FICA tax for Medicare is 1.45%.The employee's share of FICA taxes is:

An estimated liability is a known obligation of an uncertain amount that can at least be reasonably estimated.

Unearned revenue is initially recognized with a:

The amount of federal income tax withheld is based on the employee's annual earnings rate plus the number of withholding allowances claimed by the employee.

Introducing Accounting in Business

Analyzing and Recording Transactions

Adjusting Accounts and Preparing Financial Statements

Reporting and Analyzing Merchandising Operations

Reporting and Analyzing Inventories

Reporting and Analyzing Cash and Internal Controls

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Term Assets

Reporting and Analyzing Long-Term Liabilities

Reporting and Analyzing Equity

Reporting and Analyzing Cash Flows

Analyzing and Interpreting Financial Statements

Investments and International Operations

Reporting and Analyzing Partnerships

Reporting and Preparing Special Journals

Filters

Exam 9: Reporting and Analyzing Current Liabilities

A payroll register usually shows the pay period dates,hours worked,gross pay,deductions and net pay of each employee for every pay period.

When there is little uncertainty surrounding current liabilities,both GAAP and IFRS require companies to record them in a similar manner.

Describe how to account for and report on contingent liabilities.

Amounts received in advance from customers for future products or services:

If Steve Company paid $350,000 in bonuses,and net income prior to the bonus was $4,200,000,what was the bonus percentage offered to the employees during 2010?

Debt guarantees are not disclosed because the guarantor is not the primary debtor.

A single liability can be divided between current and noncurrent liabilities.

Uncertainties from the development of new competing products are contingent liabilities.

The amount of federal income taxes withheld from an employee's paycheck is determined by:

A short-term note payable is a written promise to pay a specified amount on a definite future date within one year or the operating cycle,whichever is longer.

Times interest earned is calculated by:

Promissory notes are nonnegotiable,which means they cannot be transferred from party to party.

If Jefferson Company paid a bonus equal to 8% of net income after bonuses and the total bonus distributed was $420,000,how much was net income for the year?

If a company had net income of $3,003,000,interest expense of $400,000,a tax rate of 40%,and operating income of $5,405,000,what would the times interest earned ratio be for the company?

An employee earned $47,000 during the year working for an employer.The FICA tax for social security is 6.2% and the FICA tax for Medicare is 1.45%.The employee's share of FICA taxes is:

An estimated liability is a known obligation of an uncertain amount that can at least be reasonably estimated.

Unearned revenue is initially recognized with a:

The amount of federal income tax withheld is based on the employee's annual earnings rate plus the number of withholding allowances claimed by the employee.

Introducing Accounting in Business

Analyzing and Recording Transactions

Adjusting Accounts and Preparing Financial Statements

Reporting and Analyzing Merchandising Operations

Reporting and Analyzing Inventories

Reporting and Analyzing Cash and Internal Controls

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Term Assets

Reporting and Analyzing Long-Term Liabilities

Reporting and Analyzing Equity

Reporting and Analyzing Cash Flows

Analyzing and Interpreting Financial Statements

Investments and International Operations

Reporting and Analyzing Partnerships

Reporting and Preparing Special Journals

Filters