Installment Term Loan On December 31, 2009, Beam, Inc., borrowed $600,000 on an 8%, 10-year mortgage note payable. The note is to be repaid in equal quarterly installments of $21,934 (beginning March 31, 2010). Prepare journal entries to reflect (a) the issuance of the mortgage note payable, (b) the payment of the first installment on March 31, 2010, and (c) the payment of the second installment on June 30, 2010. Round amounts to the nearest dollar. General Journal Description Date Debit Credit a.) Dec.31 Borrowed a mortgage note payable. b.) Mar.31 Interest Expense Cash To record quarterly payment. C.) Jun.30 Mortgage Note Payable To record quarterly payment. Recording Payroll and Payroll Taxes The following data are taken from Jefferson Distribution Company's March payroll: Administrative salaries $34,800 Sales salaries 66,000 Custodial salaries 9,600 Total payroll $110,400 Salaries subject to FICA tax (6.2 percent + 1.45 percent) $110,400 Salaries subject to federal unemployment taxes 81,600 Salaries subject to state unemployment taxes 91,200 Federal income taxes withheld from all salaries 22,320 Assume that the company is subject to a 5.4 percent state unemployment tax and an 0.6 percent federal unemployment tax. Required Record the following in general journal form on March 31: a. Accrual of the monthly payroll. b. Payment of the net payroll. C. Accrual of the employer's payroll taxes. (Assume that the FICA tax matches the amount withheld.) d. Payment of these payroll-related liabilities. (Assume that all are settled at the same time.) Round your answers to the nearest dollar. Part A Part B Part Part D Debit Credit General Journal Date Description Mar.31 Administrative Salaries Expense Sales Salaries Expense Federal Income Tax Withholding Payable FICA Tax Payable To record March payroll. Excise and Sales Tax Calculations Madison Corporation initially records its sales at amounts that exclude any related excise and sales taxes. During May, Madison recorded total sales of $800,000. An analysis of May sales indicated the following: 1. 30% of sales were subject to both a 10% excise tax and a 5% sales tax. 2. 60% of sales were subject only to the sales tax. 3. The balance of sales was for labor charges not subject to either excise or sales tax. Required a. Calculate the related liabilities for excise and sales taxes for May. b. Prepare the necessary journal entry at May 31, to record the monthly payment of excise tax and sales tax to the government. Sales Tax Liability $ Excise Tax Liability $ Debit Credit General Journal Date Description May 31 Excise Tax Payable Sales Tax Payable Cash To record the payment of excise and sales taxesto the government. Adjusting Entries for Interest At December 31, 2011, Portland Corporation had two notes payable outstanding (notes 1 and 2). At December 31, 2012, Portland also had two notes payable outstanding (notes 3 and 4). These notes are described below. Principal Amount Interest Rate Number of Days Date of note December 31, 2011 Note 1 November 25, 2011 Note 2 December 16, 2011 December 31, 2012 Note 3 December 11, 2012 Note 4 December 07, 2012 $29,000 18,800 896 996 17,400 20,000 996 1096 Required a. Prepare the adjusting entries for interest at December 31, 2011. b. Assume that the adjusting entries were made at December 31, 2011, and that no adjusting entries were made during 2012. Prepare the 2012 journal entries to record payment of the notes that were outstanding at December 31, 2011. c. Prepare the adjusting entries for interest at December 31, 2012. Round answers to nearest dollar. Use 360 days for interest calculations when applicable. General Journal Date Description Debit Credit Dec.31 To record interest on note 1. Dec.31 To accrue interest on note 2. Feb. 14 Notes Payable Interest Expense To record payment of Note 2. Feb.23 Notes Payable Interest Expense To record payment of Note 1. Dec.31 To record interest on Note 3. Dec.31 To record interest on Note 4. Warranty Costs Brigham Company sells an electric timer that carries a three-month unconditional warranty against product failure. Based on a reliable statistical analysis, Brigham knows that between the sale and the end of the product warranty period, three percent of the units sold will require repair at an average cost of $35 per unit. The following data reflect Brigham's recent experience: October November December Dec. 31 Total 38,000 36,000 47,000 121,000 Units sold Known product failures from sales in: October November December 320 550 230 210 360 410 1,080 590 410 Calculate, and prepare a journal entry to record, the estimated liability for product warranties at December 31. Assume that warranty costs of known failures have already been reflected in the records. General Journal Date Description Debit Credit Dec.31 To provide for estimated future warranty expense