Questions and Answers of College Accounting A Contemporary Approach 5th Edition

Payroll deductions are recorded in a separatea. Asset account.b. Expense account.c. Liability account.d. Revenue account.
Private Investigations has two office employees. A summary of their earnings and the related taxes withheld from their pay for the week ending June 7, 20X1, follows.1. Prepare the general journal
What is the purpose of the Medicare tax?
Why is it important for workers’ compensation wages to be classified according to the type of work performed?a. The company will likely pay a different rate on each classification.b. Some
Given the following scenario, choose the best answer. At the end of the quarter, the business owed $2,000 in total payroll taxes. The amount due must be deposited:a. On the last business day of the
At the end of the weekly payroll period on June 30, the payroll register of Known Consultants showed employee earnings of $50,000. Determine the firm’s payroll taxes for the period. Use a social
In each of the following independent situations, decide whether the business organization should treat the person being paid as an employee and should withhold social security, Medicare, and employee
The Form W-2 is used to report all but the following:Data From in W-2a. Gross earnings for the year.b. Total federal income tax withheld from employee earnings for the year.c. Total payroll taxes the
Who pays the federal unemployment tax and the state unemployment tax?a. Congress appropriates money to pay these taxes.b. State governments appropriate money to pay these taxes.c. Employees pay both
After Copper Corporation paid its employees on July 15 and recorded the corporation’s share of payroll taxes for the payroll paid that date, the firm’s general ledger showed a balance of $20,584
The Valley Voice is a local newspaper that is published Monday through Friday. It sells 90,000 copies daily. The paper is currently in a profit squeeze, and the publisher, Tom Turkey, is looking for
How does a favorable experience rating affect the state unemployment tax rate?a. It will likely reduce the SUTA amount due.b. It makes the FUTA tax less.c. It will make the FUTA tax more.d. It will
Nicky Norton owns a boutique dress shop that has been very successful. He employs 3 sales associates who get paid $10 per hour for a 40-hour week. He decides to open up another dress shop on the
What is the purpose of Form 941?a. Accounts for all employee gross wages and federal tax– required withholdings during a quarterb. Used to calculate the federal unemployment tax due for a quarterc.
State unemployment taxes are filed:a. Monthly.b. Quarterly.c. Yearly.d. At the end of each pay period.
Certain transactions and procedures relating to federal and state unemployment taxes follow for Robin’s Nest LLC, a retail store owned by Robin Roberts. The firm’s address is 2007 Lovely Lane,
Certain transactions and procedures relating to federal and state unemployment taxes are given below for Latest Greatest, a retail store owned by John Marion. The firm’s address is 4560 LBJ
1. Complete Form 940, the Employer’s Annual Federal Unemployment Tax Return. Assume that all wages have been paid and that all quarterly payments have been submitted to the state as required. The
Employers usually record social security taxes in the accounting records at the end of:a. Each payroll period.b. Each month.c. Each quarter.d. The year.
What is the lookback period?
On July 1, 20X1, Cherie Wang established Cherie Wang Financial Services. Selected transactions for the first few days of July follow.INSTRUCTIONS1. Record the transactions on page 1 of the general
On June 1, 20X1, William Tsang established his own consulting firm. Selected transactions for the first few days of June follow.1. Record the transactions on page 1 of the general journal. Omit
Healthy Eating Foods Company is a distributor of nutritious snack foods such as granola bars. On December 31, 20X1, the firm’s general ledger contained the accounts and balances that
Whatnots is a retail seller of cards, novelty items, and business products. On December 31, 20X1, the firm’s general ledger contained the following accounts and balances.ACCOUNTS AND
The Fashion Rack has a monthly accounting period. The firm’s chart of accounts is shown below. All transactions are recorded in a general journal. Postings are made from the general journal to the
Hog Wild is a retail firm that sells motorcycles, parts, and accessories. The adjusted trial balance data given below is from the firm’s worksheet for the year ended December 31,
The worksheet of Lantz’s Office Supplies contains the following revenue, cost, and expense accounts. Prepare a classified income statement for this firm for the year ended December 31, 20X1. The
The Office Warehouse had the following account balances: Cash, $25,000; Accounts Receivable, $75,000;Merchandise Inventory, $85,000; Equipment, $225,000; Accumulated Depreciation—Equipment,
Obtain all data that is necessary from the worksheet prepared for Healthy Eating Foods Company in Problem 12.5A at the end of Chapter 12. Then follow the instructions to complete this problem.Data
The worksheet of Lantz’s Office Supplies contains the following asset and liability accounts. The balance of the Notes Payable account consists of notes that are due within a year. Prepare a
The Adjusted Trial Balance section of the worksheet for Hendricks Janitorial Supplies follows. The owner made no additional investments during the year. Prepare a postclosing trial balance for the
1. Complete Form 940, the Employer’s Annual Federal Unemployment Tax Return. Assume that all wages have been paid and that all quarterly payments have been submitted to the state as required. The
The Income Statement section of the Johnson Company worksheet for the year ended December 31, 20X1, has $201,000 recorded in the Debit column and $216,250 in the Credit column on the line for the
Obtain all data necessary from the worksheet prepared for Enoteca Fine Wines in Problem 12.6A at the end of Chapter 12. Then follow the instructions to complete this problem.Data from in problem
Which tax is paid equally by the employee and employer?a. Federal income taxb. State income taxc. Social security taxd. Federal unemployment tax
The federal unemployment taxes are reported on:a. Form 941.b. Form 8109.c. Form W-3.d. Form 940.
On April 30, Quality Furniture Company prepared its state unemployment tax return for the first quarter of the year. The firm had taxable wages of $85,000. Because of a favorable experience rating,
Meri Medical Supplies estimates that its office employees will earn $175,000 next year and its factory employees will earn $600,000. The firm pays the following rates for workers’ compensation
Who pays for workers’ compensation insurance?
What is Form 941? How often is the form filed?Data from in 941 Form 941 for 20X1: Employer's QUARTERLY Federal Tax Return Department of the Treasury Internal Revenue Service Employer identification
The beginning inventory of SoCal Wholesalers was $121,000, and the ending inventory is $116,500. What entries are needed at the end of the fiscal period to adjust Merchandise Inventory?
Based on the information below, record the adjusting journal entries that must be made for Kisling Distributors on June 30, 20X1. The company has a June 30 fiscal year-end. Use 18 as the page number
Based on the information below, record the adjusting journal entries that must be made for D. Johnson Products, LLC, on December 31, 20X1. The company has a December 31 fiscal year-end. Use 18 as the
Which of the following is not true concerning the accrual basis of accounting?a. Revenues are recognized when earned.b. Expenses are recognized when incurred.c. Cash received for services to be
The president of Tower Copper Company has told you to go out to the factory and count merchandise inventory. He said the stockholders were coming for a meeting next week and he wanted to put on a
Which of the following best describes the Accumulated Depreciation account?a. A contra-asset account with a normal debit balanceb. A contra-asset account with a normal credit balancec. An expense
When Sandra Michaels’s father took seriously ill suddenly, Sandra had just completed the semester in college, so she stepped in to run the family business, ASAP Couriers, until it could be sold.
A company has merchandise inventory at the beginning of the year of $14,000 and merchandise inventory at the end of the year of $18,000. Which of the following would be included in the adjusting
A company failed to record depreciation expense. Which of the following is not true?a. The company’s net income will be overstated.b. The company’s total assets will be overstated.c. The
For each of the following independent situations, prepare the adjusting entry that must be made at December 31, 20X1. Omit descriptions.a. During the year 20X1, Alenikov Company had net credit sales
On July 31, 20X1, after one month of operation, the general ledger of Michael Mendoza, CPA, contained the accounts and balances given below.INSTRUCTIONS1. Prepare a partial worksheet with the
MJF Company has net credit sales of $2,500,000 and estimates bad debts at 0.5 percent of net credit sales. Which of the following journal entries would be used to record estimated uncollectible
The Sales account will appear in which of the following in the worksheet?a. Income Statement Debit columnb. Balance Sheet Debit columnc. Income Statement Credit columnd. Balance Sheet Credit column
For each of the following independent situations, prepare the adjusting entry that must be made on December 31, 20X1. Omit descriptions.a. On December 31, 20X1, the Notes Payable account at Tsang
In Caymus Company’s December 31 trial balance, a credit balance of $31,500 appears in Unearned Fee Income. This amount represents cash received from a customer on November 1 covering work to be
The amount of net income appears on the worksheet in the:a. Credit column of the Adjusted Trial Balance section.b. Debit colc. Credit column of the Income Statement section. c. Credit column of
On December 1, 20X1, Jenny’s Java Joint borrowed $50,000 from its bank in order to expand its operations. The firm issued a four-month, 9 percent note for $50,000 to the bank and received $48,500
In Naranjo Company’s December 31 trial balance, a debit balance of $18,000 is found in the Prepaid Rent account. A payment of $18,000 for prepayment of six months’ rent was made on September 1.
The Notes Payable account appears on the worksheet in the:a. Credit column of the Balance Sheet section.b. Debit column of the Balance Sheet section.c. Credit column of the Income Statement
On December 31, 20X1, the Notes Payable account at Cherie’s Boutique Shop had a balance of $72,000. This amount represented funds borrowed on a six-month, 6 percent note from the firm’s bank on
Enoteca Fine Wines is a retail store selling vintage wines. On December 31, 20X1, the firm’s general ledger contained the accounts and balances below. All account balances are
Gamer’s Paradise is a retail store that sells computer games, owned by Matt Huffman. On December 31, 20X1, the firm’s general ledger contained the accounts and balances below. All account
Calderone Company purchased office equipment for $9,000 on October 1 of the current year. The office equipment has a useful life of six years and salvage value of $360. What is the amount of
The Merchandise Inventory account appears on the worksheet in the:a. Credit column of the Balance Sheet section.b. Debit column of the Balance Sheet section.c. Credit column of the Income Statement
For each of the following independent situations, prepare the adjusting entry that must be made at December 31, 20X1. Omit descriptions.a. On December 31, 20X1, the Notes Receivable account at Sufen
Debtor Company borrowed $10,000 on a six-month note payable on November 1 of the current year. The note bears interest at an annual interest rate of 9 percent. What is the amount of accrued interest
The Unearned Fees account appears on the worksheet in the:a. Credit column of the Balance Sheet section.b. Debit column of the Balance Sheet section.c. Credit column of the Income Statement
What is an accrued expense? Give three examples of items that often become accrued expenses.
ComputerGeeks.com is a retail store that sells computers, laptops, supplies, and other electronic devices. The adjusted trial balance data given below is from the firm’s worksheet for the year
Programs Plus is a retail firm that sells computer programs for home and business use. Programs Plus operates in a state with no sales tax. On December 31, 20X1, its general ledger contained the
1. Why should management be concerned about the efficiency of the end-of-period procedures?2. Spectrum Company had an increase in sales and net income during its last fiscal year, but cash decreased
Roberto Company has sales of $1,000,000, sales returns and allowances of $10,000, sales discounts of $2,000, and salary expense—sales of $120,000. What is the amount of net sales?a. $1,012,000b.
Which of the following accounts would not appear on the postclosing trial balance?a. Cashb. Accumulated Depreciation—Office Equipmentc. Suppliesd. Supplies Expense
The accounts listed below appear on the worksheet of Commonwealth Crafts. Indicate the section of the classified income statement in which each account will be reported.SECTIONS OF CLASSIFIED INCOME
Brandon Marchand is the owner of Divine Jewels, a store specializing in gold, platinum, and special stones. During the past year, in response to increased demand, Brandon doubled his selling space by
Generally accepted accounting principles require that the principal amount due in the upcoming ear on long-term debt be presented as a current liability on the balance sheet. This requires the
Kelley Company has beginning inventory of $125,000, purchases of $950,000, purchases returns and allowances of $25,000, freight-in of $10,000, and ending inventory o $118,000. What is the amount of
The purpose of the second closing entry is to:a. Close expense accounts and cost of goods sold accounts with debit balances.b. Close expense accounts and cost of goods sold accounts with credit
The following accounts appear on the worksheet of Commonwealth Crafts at December 31, 20X1. Indicate the section of the classified balance sheet in which each account will be reported.SECTIONS OF
Obtain all data necessary from the worksheet prepared for Gamer’s Paradise in Problem 12.6B at the end of Chapter 12. Then follow the instructions to complete this problem.Data from in
McCormick & Company, Inc., is a global leader in the manufacture, marketing, and distribution of spices, seasoning mixes, condiments, and other products to the food industry. McCormick &
Chen Company has net sales of $500,000, cost of goods sold of $300,000, and interest expense of $10,000. What is the amount of gross profit on sales?a. $200,000b. $198,000c. $202,000d. None of these
What are operating expenses? Are financing expenses included in operating expenses?
Which of the following is not a current asset?a. Merchandise inventoryb. A note receivable due in 11 monthsc. Prepaid insurance covering the next eight monthsd. A note receivable due in 13 months
A reversing entry is made for an end-of-period adjustment that recorded:a. Estimated bad debts for the period.b. An accrued expense that involves future cash payments.c. A transfer of an amount from
The data below concerns adjustments to be made at Tea Leaf Importers.INSTRUCTIONS1. Record the adjusting entries in the general journal as of December 31, 20X1. Use 25 as the first journal page
How should purchases returns and allowances be shown on the income statement?a. As Other Incomeb. As an addition to the delivered cost of purchasesc. As a deduction from the delivered cost of
Vanessa Company reported net sales of $1,000,000, cost of goods sold of $600,000, and gross profit of $400,000. Merchandise Inventory was $50,000 and $70,000 at the beginning and end of the period,
Which of these is not a general and administrative expense?a. Rent expenseb. Salaries expense—officec. Advertising expensed. Uncollectible accounts expense
Marco Company reported net credit sales of $1,500,000, cost of goods sold of $800,000, and gross profit of $700,000. Accounts Receivable were $175,000 and $225,000 at the beginning and end of the
What information is provided by the statement of owner’s equity?
The balance of James Wilson, Capital at the beginning of the period was $50,000. During the period, his company had net income of $40,000, and he withdrew $35,000 from the business for personal use.
On December 31, 20X1, the Income Statement columns of the worksheet for The Sax Shop contained the following information. Give the entries that should be made in the general journal to close the
Examine the following adjusting entries and determine which ones should be reversed. Show the reversing entries that should be recorded in the general journal as of January 1, 20X2. Include
Which of the following would not be classified as Plant and Equipment on a balance sheet?a. Prepaid insuranceb. Autosc. Store equipmentd. Office equipment
What account balances or other amounts are included on two different financial statements for the period? Which statements are involved?
The following selected accounts were taken from the financial records of Sonoma Valley Distributors at December 31, 20X1. All accounts have normal balances.Accounts Receivable at December 31, 20X0,
Tsang Company reports the following in its most recent year of operations:■ Net sales, $2,000,000 (all on account)■ Cost of goods sold, $977,500■ Gross profit, $1,022,500■ Accounts
Selected accounts and other information from the records of Calderone Company for the year ended December 31 follow:1. Compute the following items that would appear on a classified income statement.
Fuji Company had a current ratio of 2.0 in 20X1 and 2.2 in 20X2. Does this signify an improvement or decline in Fuji Company’s liquidity from 20X1 to 20X2?

Showing 700 - 800 of 1060