Question 1

Unearned revenues are the same as liabilities.

Accepted Answer

A) True 
 B)False

Question 2

For the year ended December 31,2010,Mason Company has implemented an employee bonus program equal to 7% of Mason's net income,which employees will share equally.Mason's net income (pre-bonus)is expected to be $3,500,000,and bonus expense is deducted in computing net income.What is the amount that needs to be recorded for estimated bonus liability for 2010?

Accepted Answer

A) $245,000 
B) $144,118 
C) $228,972 
D) $50,000 
E) $125,000 
A) $245,000 
B) $144,118 
C) $228,972 
D) $50,000 
E) $125,000

Question 3

A company sells computers with a 6-month warranty.In January,the company sold 100,000 computers at $1,750 each and 1,500 computers were turned in for repairs during that same month.The total repairs amounted to $185,000 costs from the computer parts inventory.It is estimated that 2% of all units sold will need repairs under warranty at an estimated cost of $200 per unit.Prepare the journal entries to record (a)estimated warranty expense for January and (b)warranty repair costs for January.

Accepted Answer

None

Question 4

A contingent liability is a potential obligation that depends on a future event arising from a future transaction or event.

Accepted Answer

A) True 
 B)False

Question 5

Describe employer responsibilities for reporting payroll taxes.(To the extent possible,reference the form to be filed for each tax.)

Accepted Answer

Employers are required to report FICA ta

Question 6

All expected future payments are liabilities.

Accepted Answer

A) True 
 B)False

Question 7

The employer should record payroll deductions as:

Accepted Answer

A) Employee receivables 
B) Payroll taxes 
C) Current liabilities 
D) Wages payable 
E) Employee payables 
A) Employee receivables 
B) Payroll taxes 
C) Current liabilities 
D) Wages payable 
E) Employee payables

Question 8

A company's employer payroll taxes are 0.8% for federal unemployment taxes,5.4% for state unemployment taxes,6.2% for FICA social security taxes on earnings up to $106,800 and 1.45% for FICA Medicare taxes on all earnings.Compute the W-2 Wage and Tax Statement information required below for the following employees:
 $\begin{array}{|l|c|c|}
\hline \text { Employee } & \text { Gross Earnings } & \text { Federal Income Taxes Withheld } \
\hline \text { A. Barker } & \$ 84,000 & \$ 17,600 \
\hline \text { C. Dirkson } & 52,000 & 8,200\
\hline 
\end{array}$ 
 $\begin{array}{|l|l|l|}
\hline \text { W-2 Information } & \text { A. Baker } & \text { C. Dirkson } \
\hline\text { Federal Income Tax Withheld } & & \
\hline \text { Wages, Tips, Other Compensation } & & \
\hline \text { Social Security Tax Withheld } & & \
\hline \text { Social Security Wages } & & \
\hline \text { Medicare Tax Withheld } & &\
\hline
\end{array}$

Accepted Answer

The answer of A company's employer payroll taxes are 0.8%...

Question 9

The times interest earned computation is:

Accepted Answer

A) (Net income + Interest expense + Income taxes)/Interest expense 
B) (Net income + Interest expense - Income taxes)/Interest expense 
C) (Net income - Interest expense - Income taxes)/Interest expense 
D) (Net income - Interest expense + Income taxes)/Interest expense 
E) Interest expense/(Net income + Interest expense + Income taxes expense) 
A) (Net income + Interest expense + Income taxes)/Interest expense 
B) (Net income + Interest expense - Income taxes)/Interest expense 
C) (Net income - Interest expense - Income taxes)/Interest expense 
D) (Net income - Interest expense + Income taxes)/Interest expense 
E) Interest expense/(Net income + Interest expense + Income taxes expense)

Question 10

Coke had income before interest expense and income taxes of $5,698 million and interest expense of $199 million.Calculate Coke's times interest earned ratio.

Accepted Answer

The answer of Coke had income before interest expense and...

Question 11

A company can have a liability even if the amount of the obligation is unknown.

Accepted Answer

A) True 
 B)False

Question 12

Gross pay is also called take-home pay.

Accepted Answer

A) True 
 B)False

Question 13

Match between columns
                        Premises:  FICA taxes payable
 Payment of a 4-year loan due this year
 Payment of a 30-year loan due this year
 Debt guarantees
 30-day promissory note
 Payment of a 30-year loan due next year (The company operating cycle is 2 months)
 Accounts payable
 Income taxes payable
 Salaries payable
 Warranty work completed this year

Accepted Answer

The Answer of current liability and long-term liability and not is...

Question 14

Payroll taxes are considered to be contingent liabilities.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following is a true statement?

Accepted Answer

A) GAAP and IFRS treat accounts payable,sales taxes payable and unearned revenues in a similar manner as estimated liabilities 
B) GAAP treats accounts payable,sales taxes payable and unearned revenues as estimated liabilities while IFRS treats them as contingent liabilities. 
C) IFRS treats accounts payable,sales taxes payable and unearned revenues as estimated liabilities while GAAP treats them as contingent liabilities. 
D) GAAP and IFRS treat accounts payable,sales taxes payable and unearned revenues in a similar manner as determinable liabilities 
E) None of the statements above are true statements 
A) GAAP and IFRS treat accounts payable,sales taxes payable and unearned revenues in a similar manner as estimated liabilities 
B) GAAP treats accounts payable,sales taxes payable and unearned revenues as estimated liabilities while IFRS treats them as contingent liabilities. 
C) IFRS treats accounts payable,sales taxes payable and unearned revenues as estimated liabilities while GAAP treats them as contingent liabilities. 
D) GAAP and IFRS treat accounts payable,sales taxes payable and unearned revenues in a similar manner as determinable liabilities 
E) None of the statements above are true statements

Question 16

Companies with many employees often use a special ____________________ account to pay employees.

Accepted Answer

The answer of Companies with many employees often use a...

Question 17

Required employee payroll deductions include income taxes,Social Security taxes,pension and health contributions,union dues and charitable giving.

Accepted Answer

A) True 
 B)False

Question 18

Income tax liabilities are the same whether calculated by tax accounting methods or by financial accounting methods.

Accepted Answer

A) True 
 B)False

Question 19

A company sells personal computers,with an included two-year warranty for $2,300 each.During the current year,the company sells 400 computers.On the basis of past experience,the warranty costs are estimated to be $250 per computer.The actual warranty costs (paid in cash)by the company during the current year were $65,000.Prepare general journal entries to record the (a)estimated warranty expense and (b)warranty repair costs during current year.

Accepted Answer

None

Question 20

The matching principle requires that interest expense not be accrued on a note payable until the note is paid,even if the end of an accounting period occurs between the signing of a note payable and its maturity date.

Accepted Answer

A) True 
 B)False

Unearned revenues are the same as liabilities.

A contingent liability is a potential obligation that depends on a future event arising from a future transaction or event.

Describe employer responsibilities for reporting payroll taxes.(To the extent possible,reference the form to be filed for each tax.)

All expected future payments are liabilities.

The employer should record payroll deductions as:

The times interest earned computation is:

Coke had income before interest expense and income taxes of $5,698 million and interest expense of $199 million.Calculate Coke's times interest earned ratio.

A company can have a liability even if the amount of the obligation is unknown.

Gross pay is also called take-home pay.

Payroll taxes are considered to be contingent liabilities.

Which of the following is a true statement?

Companies with many employees often use a special ____________________ account to pay employees.

Required employee payroll deductions include income taxes,Social Security taxes,pension and health contributions,union dues and charitable giving.

Income tax liabilities are the same whether calculated by tax accounting methods or by financial accounting methods.

The matching principle requires that interest expense not be accrued on a note payable until the note is paid,even if the end of an accounting period occurs between the signing of a note payable and its maturity date.

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

Unearned revenues are the same as liabilities.

A contingent liability is a potential obligation that depends on a future event arising from a future transaction or event.

Describe employer responsibilities for reporting payroll taxes.(To the extent possible,reference the form to be filed for each tax.)

All expected future payments are liabilities.

The employer should record payroll deductions as:

The times interest earned computation is:

Coke had income before interest expense and income taxes of $5,698 million and interest expense of $199 million.Calculate Coke's times interest earned ratio.

A company can have a liability even if the amount of the obligation is unknown.

Gross pay is also called take-home pay.

Payroll taxes are considered to be contingent liabilities.

Which of the following is a true statement?

Companies with many employees often use a special ____________________ account to pay employees.

Required employee payroll deductions include income taxes,Social Security taxes,pension and health contributions,union dues and charitable giving.

Income tax liabilities are the same whether calculated by tax accounting methods or by financial accounting methods.

The matching principle requires that interest expense not be accrued on a note payable until the note is paid,even if the end of an accounting period occurs between the signing of a note payable and its maturity date.

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