Exercise 237 a-b

Hunt Company purchased factory equipment with an invoice price of $90,000. Other costs incurred were freight costs, $1,100; installation wiring and foundation, $2,200; material and labor costs in testing equipment, $700; oil lubricants and supplies to be used with equipment, $500; fire insurance policy covering equipment, $1,400. The equipment is estimated to have a $5,000 salvage value at the end of its 8-year useful service life.

Compute the acquisition cost of the equipment.

1) Acquisition cost of the equipment$_______________

2) If the double-declining-balance method of depreciation was used, the constant percentage applied to a declining book value would be ____________%

3) Exercise 178 a-b

Prepare the necessary journal entries for the following transactions:

On September 1, Draper Company borrowed $180,000 from Dixion County Bank on a 6-month, 8% note.(Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Account Titles and Explanation |Debit |Credit

_______________________________ _______ _______

_______________________________ _______ ________

4) On December 31, Draper Company accrued interest (assume adjusting entries are only made at the end of the year).(Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Account Titles and Explanation |Debit |Credit

__________________________________ ______ _______

__________________________________ ______ _______

5) Exercise 201 a-b

In March, gross earnings of Perlman Company totaled $250,000. All earnings are subject to 7.65% FICA taxes, 5.4% state unemployment taxes, and 0.8% federal unemployment taxes.

Compute the employer's payroll tax expense.

6) Payroll tax expense $___________

7) Prepare the entry to record payroll taxes.(Credit account titles are automatically indented when the amount is entered.Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Account Titles and Explanation |Debit |Credit

__________________________________ _________ ________

__________________________________ ___________ _________

___________________________________ __________ __________