chp 8 last

You decide to get started - the sooner the better!

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Chart of Accounts

CHART OF ACCOUNTS

Copperfield and Company

General Ledger

	ASSETS
110	Cash
112	Accounts Receivable
113	Interest Receivable
114	Notes Receivable
115	Inventory
117	Supplies
118	Prepaid Insurance
120	Land
123	Building
124	Accumulated Depreciation-Building
125	Office Equipment
126	Accumulated Depreciation-Office Equipment

	LIABILITIES
210	Accounts Payable
211	Salaries Payable
213	Interest Payable
215	Notes Payable
216	Social Security Tax Payable
217	Medicare Tax Payable
218	Employees Federal Income Tax Payable
219	Employees State Income Tax Payable
220	Retirement Contributions Payable
221	Charitable Contributions Payable
222	Medical Insurance Payable
224	Federal Unemployment Tax Payable
225	State Unemployment Tax Payable
228	Warranty Payable

	EQUITY
310	Common Stock
311	Retained Earnings
312	Dividends
313	Income Summary

	REVENUE
410	Sales Revenue
610	Interest Income

	EXPENSES
510	Cost of Goods Sold
520	Salaries Expense
521	Wages Expense
523	Delivery Expense
524	Depreciation Expense-Building
526	Repairs Expense
529	Selling Expenses
531	Rent Expense
532	Depreciation Expense-Office Equipment
533	Insurance Expense
534	Supplies Expense
535	Payroll Tax Expense
536	Pension Expense
538	Cash Short and Over
539	Warranty Expense
540	Miscellaneous Expense
710	Interest Expense

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Payroll

The following payroll

The total amount paid to employees for a certain period.

journal entries for Oct. 15 were made by your predecessor. For FICA tax

Federal Insurance Contributions Act tax used to finance federal programs for old-age and disability benefits (social security) and health insurance for the aged (Medicare).

, assume that the social security rate is 6.0% and the Medicare rate is 1.5%. The state and federal unemployment tax rates are 5.4% and 0.8%, respectively. The company offers 401k plans to employees. Review the journal entries, then answer the questions that follow.

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GENERAL JOURNAL

ACCOUNTING EQUATION

	DATE	ACCOUNT TITLE	POST. REF.	DEBIT	CREDIT	ASSETS	LIABILITIES	EQUITY
1	Oct. 15	Salaries Expense		766,300.00
2		Wages Expense		203,700.00
3		Social Security Tax Payable			58,200.00
4		Medicare Tax Payable			14,550.00
5		Employees Federal Income Tax Payable			174,600.00
6		Medical Insurance Payable			106,700.00
7		Retirement Contributions Payable			145,500.00
8		Salaries Payable			470,450.00
9	15	Payroll Tax Expense		74,207.00
10		Social Security Tax Payable			58,200.00
11		Medicare Tax Payable			14,550.00
12		Federal Unemployment Tax Payable			188.00
13		State Unemployment Tax Payable			1,269.00

In order to confirm the previous clerks payroll calculations, you have been asked to supply the following amounts based on your review of the payroll entries. These amounts will be checked against the company records and investigated further if necessary.

1. Determine the payroll amount subject to federal and state unemployment taxes in this payroll.

Points:

2. What is the total payroll for Copperfield and Company shown in these journal entries?

Points:

3. What is Copperfield and Companys share of FICA taxes in this payroll?

Points:

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Check My Work

Explanation

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Short-Term Note Payable

Copperfield and Company issued a 90-day, 5.00% note for $180,000 to a creditor on account. The previous clerk entered the following journal entries to record the note on July 10, and the payment of the note at maturity.

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GENERAL JOURNAL

ACCOUNTING EQUATION

	DATE	ACCOUNT TITLE	POST. REF.	DEBIT	CREDIT	ASSETS	LIABILITIES	EQUITY
1	Jul. 10	Accounts Payable		180,000.00
2		Notes Payable			180,000.00
3		Notes Payable		189,000.00
4		Accounts Payable			180,000.00
5		Interest Expense			9,000.00

You notice that the journal entry for recording the note on July 10 is correct, but the entry for the payment of the note at maturity (including interest) did not have a date and was not correct.

Journalize the payment of the note at maturity as it should have been journalized. Dont forget to include the date. Assume a 360-day year.