Mistery Problem: Current Liabilities and Payroll Copperfield and company You've just started your first accounting job as the accounts payable and payroll clerk for Copperfield and Company provider of delicate wine glasses to restaurants. Your predecessor left his job suddenly and was not able to complete all his tasks before leaving. You need to get up to speed and complete the unfinished tasks as soon as possible, Your tasks on your first day are the following Review the payroll register to determine if there are any errors or omissions 2. Compute the relevant amounts for the company's note payable and determine whether your predecessor's journal entries are correct. Make a recommendation as to whether the company should journalize any warranty expense for the month Payroll Since this is your first day, you're relieved to find that the company has only three employees in the main office that have not yet been reviewed. The partial payroll register for these employees follows. Some data is missing and other data may be in error. Each of these employees earns $18.00 per hour, and the company follows the Fair Labor Standards Act in paying overtime to its employees. You have been assured that the Federal Income Tax withholding and check numbers are correct, so you do not need to check those res Note 1: For 2016, the social security tax rate was 6.2% and the Medicare tax rate was 1.45%. However, for text examples and problems, including this one, use rates of 6% for social security tax and 1.5% for Medicare tax. Note 2:Caming subject to the social security tax are limited to an annual threshold amount, but for text examples and problems, including this one, assume all accumulated annual earnings are below this threshold and subject to the tax. Review the following payroll register, which was prepared by your predecessor, and then scroll down to complete a corrected payroll register. If there is no amount or an amount is rero, enter". Round your interim computations to the nearest cent, if required. Earnings Deductions Paid Accounts withheld Debited Social Medicare Federal Wages Regular Overtime Total Security Tax Income Net Pay Check Expense Total 720.00 10.80 43.20 52.25 106.25 613.75 2355 613.75 Correct the Payroll Register 792.00 11.88 47.52 63.75 123.15 668.85 2557 668.85 770.00 720.00 10.80 43.20 32.55 86,55 633.45 2892 633.45 2,222 $ 2.232133.48 133.92 148.55 315.95 1.916.05 1,916.05 Short-term Note Payable Copperfield and company wed a 90-day, 6.00 note for $200,000 to a creditor on account. The previous clerk entered the following ournal entries to record the note on July 10, and the payment of the note at maturity 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. Show the journal entry for payment of the note at maturity as it should have been entered. Don't forget to include the date. Assume a 360-day year. Description Post. Ref. Credit Liabilities Equity July 10 Debit 200,000.00 Date Accounts payable Notes payable Notes payable 200,000.00 212,000.00 Accounts payable 200,000.00 12,000.00 Warranty Copperfield and Company has decided to provide a warranty on its products. The previous clerk left a note with his files on this new warranty on glass breakage. He decided that an entry for warranty expense was not necessary, with the following reasoning *Our product is the finest in the world, and thus the contingency of a warranty replacement for breakage is remote. Under accounting standards, the proper treatment for a remote likelihood of occurrence is to take no action. Accordingly, in my professional judgement, no journal entry should be made for warranty expense You should review the previous clerk's notes and evaluate his decision. After refreshing your memory on the treatment of contingent liabilities, what action will you take? a. Since there's no way to accurately determine the amount of breakage that might occur, no entry or disclosure is required. b. Make no entry, the previous derk is correct that there is a remote chance of any breakage. c Journalize an adjusting en kry debating Product Warranty Expense and crediting Product Warranty Payable. Assume that a reasonable estimate of the warranty cost can be determined by an examination of prior breakage and replacement data. d. Make no entry but disclose the possible warrant liability amount in the notes to the company financial statements. Mastery Problem: Current Liabilities and Payroll Copperfield and Company Tou've just started your first accounting job as the accounts payable and payroll clerk for Copperfield and Company a provider of delicate wine glasses to restaurants. Your predecessor left his job suddenly and was not able to complete all his tasks before leaving. You need to get up to speed and complete the unfinished tasks as soon as possible. Your tasks on your first day are the following: 1. Review the payroll register to determine if there are any errors or omissions. 2. Compute the relevant amounts for the company's note payable and determine whether your predecessor's journal entries are correct. 3. Make a recommendation as to whether the company should journalire any warranty expense for the month Payroll Since this is your first day, you're relieved to find that the company has only three employees in the main office that have not yet been reviewed. The partial payroll register for these employees follows. Some data is missing and other data may be in error. Each of these employees earns $18.00 per hour, and the company follows the Fair Labor Standards Act in paying overtime to its employees. You have been assured that the Federal Income Tax withholding and check numbers are correct, so you do not need to check those figures. Note 1: For 2016, the social security tax rate was 6.2% and the Medicare tax rate was 1.45%. However, for text examples and problems, including this one, use rates of 6% for social security tax and 1.5% for Medicare tax. Note 2: Earnings subject to the social security tax are limited to an annual threshold amount, but for text examples and problems, including this one, assume all accumulated annual earnings are below this threshold and subject to the tax. Review the following payroll register, which was prepared by your predecessor, and then scroll down to complete a corrected payroll register. If there is no amount or an amount is zero, enter "0". Round your interim computations to the nearest cent, if required Earnings Deductions Paid Accounts Withheld Debited Total: Social Medicare Federal Wages Employee Hours Regular Overtime Total Security Tax Income Total Net Pay Check Expense Name 52.25 720.00 10.80 Dartle, 2355 43.20 40 613.75 720.00 106.25 613.75 Correct the Payroll Register Rosa 63.75 792.00 11.88 792.00 123.15 668.85 47.52 Traddles, 2557 668.85 44 Thomas 720.00 40 633.45 633.45 32.55 43.20 10.80 Wickfield, 720.00 2892 86.55 Agnes $ 33.48 2,232 2,232 133.92 148.55 1,916.05 315.95 Total 1,916.05 NO. Tax Short-term Note Payable Copperfield and Company issued a 90 day, 6.00 note for $200.000 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 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. Show the journal entry for payment of the note at maturity as it should have been entered. Don't forget to include the date. Assume a 360-day year. Date Description Post. Ref. Debit Credit Assets Liabilities Equity July 10 Accounts 200,000.00 payable Notes 200,000.00 payable Notes payable 212,000.00 200,000.00 Accounts payable Interest Expense 12,000.00 Warranty Copperfield and Company has decided to provide a warranty on its products. The previous clerk left a note with his files on this new warranty on glass breakage. He decided that an entry for warranty expense was not necessary, with the following reasoning: "Our product is the finest in the world, and thus the contingency of a warranty replacement for breakage is remote. Under accounting standards, the proper treatment for a remote likelihood of occurrence is to take no action. Accordingly, in my professional judgement, no journal entry should be made for warranty expense" You should review the previous clerk's notes and evaluate his decision. After refreshing your memory on the treatment of contingent liabilities, what action will you take? a. Since there's no way to accurately determine the amount of breakage that might occur, no entry or disclosure is required. b. Make no entry, the previous clerk is correct that there is a remote chance of any breakage. C. Journalize an adjusting entry debating Product Warranty Expense and crediting Product Warranty Payable. Assume that a reasonable estimate of the warranty cost can be determined by an examination of prior breakage and replacement data. d. Make no entry but disclose the possible warrant liability amount in the notes to the company financial statements Mistery Problem: Current Liabilities and Payroll Copperfield and company You've just started your first accounting job as the accounts payable and payroll clerk for Copperfield and Company provider of delicate wine glasses to restaurants. Your predecessor left his job suddenly and was not able to complete all his tasks before leaving. You need to get up to speed and complete the unfinished tasks as soon as possible, Your tasks on your first day are the following Review the payroll register to determine if there are any errors or omissions 2. Compute the relevant amounts for the company's note payable and determine whether your predecessor's journal entries are correct. Make a recommendation as to whether the company should journalize any warranty expense for the month Payroll Since this is your first day, you're relieved to find that the company has only three employees in the main office that have not yet been reviewed. The partial payroll register for these employees follows. Some data is missing and other data may be in error. Each of these employees earns $18.00 per hour, and the company follows the Fair Labor Standards Act in paying overtime to its employees. You have been assured that the Federal Income Tax withholding and check numbers are correct, so you do not need to check those res Note 1: For 2016, the social security tax rate was 6.2% and the Medicare tax rate was 1.45%. However, for text examples and problems, including this one, use rates of 6% for social security tax and 1.5% for Medicare tax. Note 2:Caming subject to the social security tax are limited to an annual threshold amount, but for text examples and problems, including this one, assume all accumulated annual earnings are below this threshold and subject to the tax. Review the following payroll register, which was prepared by your predecessor, and then scroll down to complete a corrected payroll register. If there is no amount or an amount is rero, enter". Round your interim computations to the nearest cent, if required. Earnings Deductions Paid Accounts withheld Debited Social Medicare Federal Wages Regular Overtime Total Security Tax Income Net Pay Check Expense Total 720.00 10.80 43.20 52.25 106.25 613.75 2355 613.75 Correct the Payroll Register 792.00 11.88 47.52 63.75 123.15 668.85 2557 668.85 770.00 720.00 10.80 43.20 32.55 86,55 633.45 2892 633.45 2,222 $ 2.232133.48 133.92 148.55 315.95 1.916.05 1,916.05 Short-term Note Payable Copperfield and company wed a 90-day, 6.00 note for $200,000 to a creditor on account. The previous clerk entered the following ournal entries to record the note on July 10, and the payment of the note at maturity 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. Show the journal entry for payment of the note at maturity as it should have been entered. Don't forget to include the date. Assume a 360-day year. Description Post. Ref. Credit Liabilities Equity July 10 Debit 200,000.00 Date Accounts payable Notes payable Notes payable 200,000.00 212,000.00 Accounts payable 200,000.00 12,000.00 Warranty Copperfield and Company has decided to provide a warranty on its products. The previous clerk left a note with his files on this new warranty on glass breakage. He decided that an entry for warranty expense was not necessary, with the following reasoning *Our product is the finest in the world, and thus the contingency of a warranty replacement for breakage is remote. Under accounting standards, the proper treatment for a remote likelihood of occurrence is to take no action. Accordingly, in my professional judgement, no journal entry should be made for warranty expense You should review the previous clerk's notes and evaluate his decision. After refreshing your memory on the treatment of contingent liabilities, what action will you take? a. Since there's no way to accurately determine the amount of breakage that might occur, no entry or disclosure is required. b. Make no entry, the previous derk is correct that there is a remote chance of any breakage. c Journalize an adjusting en kry debating Product Warranty Expense and crediting Product Warranty Payable. Assume that a reasonable estimate of the warranty cost can be determined by an examination of prior breakage and replacement data. d. Make no entry but disclose the possible warrant liability amount in the notes to the company financial statements. Mastery Problem: Current Liabilities and Payroll Copperfield and Company Tou've just started your first accounting job as the accounts payable and payroll clerk for Copperfield and Company a provider of delicate wine glasses to restaurants. Your predecessor left his job suddenly and was not able to complete all his tasks before leaving. You need to get up to speed and complete the unfinished tasks as soon as possible. Your tasks on your first day are the following: 1. Review the payroll register to determine if there are any errors or omissions. 2. Compute the relevant amounts for the company's note payable and determine whether your predecessor's journal entries are correct. 3. Make a recommendation as to whether the company should journalire any warranty expense for the month Payroll Since this is your first day, you're relieved to find that the company has only three employees in the main office that have not yet been reviewed. The partial payroll register for these employees follows. Some data is missing and other data may be in error. Each of these employees earns $18.00 per hour, and the company follows the Fair Labor Standards Act in paying overtime to its employees. You have been assured that the Federal Income Tax withholding and check numbers are correct, so you do not need to check those figures. Note 1: For 2016, the social security tax rate was 6.2% and the Medicare tax rate was 1.45%. However, for text examples and problems, including this one, use rates of 6% for social security tax and 1.5% for Medicare tax. Note 2: Earnings subject to the social security tax are limited to an annual threshold amount, but for text examples and problems, including this one, assume all accumulated annual earnings are below this threshold and subject to the tax. Review the following payroll register, which was prepared by your predecessor, and then scroll down to complete a corrected payroll register. If there is no amount or an amount is zero, enter "0". Round your interim computations to the nearest cent, if required Earnings Deductions Paid Accounts Withheld Debited Total: Social Medicare Federal Wages Employee Hours Regular Overtime Total Security Tax Income Total Net Pay Check Expense Name 52.25 720.00 10.80 Dartle, 2355 43.20 40 613.75 720.00 106.25 613.75 Correct the Payroll Register Rosa 63.75 792.00 11.88 792.00 123.15 668.85 47.52 Traddles, 2557 668.85 44 Thomas 720.00 40 633.45 633.45 32.55 43.20 10.80 Wickfield, 720.00 2892 86.55 Agnes $ 33.48 2,232 2,232 133.92 148.55 1,916.05 315.95 Total 1,916.05 NO. Tax Short-term Note Payable Copperfield and Company issued a 90 day, 6.00 note for $200.000 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 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. Show the journal entry for payment of the note at maturity as it should have been entered. Don't forget to include the date. Assume a 360-day year. Date Description Post. Ref. Debit Credit Assets Liabilities Equity July 10 Accounts 200,000.00 payable Notes 200,000.00 payable Notes payable 212,000.00 200,000.00 Accounts payable Interest Expense 12,000.00 Warranty Copperfield and Company has decided to provide a warranty on its products. The previous clerk left a note with his files on this new warranty on glass breakage. He decided that an entry for warranty expense was not necessary, with the following reasoning: "Our product is the finest in the world, and thus the contingency of a warranty replacement for breakage is remote. Under accounting standards, the proper treatment for a remote likelihood of occurrence is to take no action. Accordingly, in my professional judgement, no journal entry should be made for warranty expense" You should review the previous clerk's notes and evaluate his decision. After refreshing your memory on the treatment of contingent liabilities, what action will you take? a. Since there's no way to accurately determine the amount of breakage that might occur, no entry or disclosure is required. b. Make no entry, the previous clerk is correct that there is a remote chance of any breakage. C. Journalize an adjusting entry debating Product Warranty Expense and crediting Product Warranty Payable. Assume that a reasonable estimate of the warranty cost can be determined by an examination of prior breakage and replacement data. d. Make no entry but disclose the possible warrant liability amount in the notes to the company financial statements