1-

Which of the following statements about payroll is correct?

Multiple Choice

• Payroll deductions are an expense of the company.

• When recording the payroll, Salaries and Wages Expense equals the sum of all the deductions.

• The net pay is debited to Salaries and Wages Expense when the payroll is recorded.

• Gross earnings are computed by multiplying the time worked by the pay rate promised by the employer.

2-

A 10-year bond that pays interest annually was issued at a $5,000 premium. The entry to record the payment of interest using straight-line amortization will include a ________ to Premium on Bonds Payable for ________ each period.

Multiple Choice

• credit $500

• debit; $500

• debit a greater amount each period

• credit a lower amount each period