Principles of Financial Accounting ACC 120 Chapter 10 Practical Test Name _______________ Problem One A business issued a 120-day, 6% note for $50,000 to a creditor on account. The company uses a 360-day year for interest calculations. Journalize the entries to record (a) the issuance of the note and (b) the payment of the note at maturity, including interest. DATE JOURNAL ITEM PR Page XX CREDIT DEBIT Problem Two An employee earns $40 per hour and 1.5 times that rate for all hours in excess of 40 hours per week. Assume that the employee worked 60 hours during the week, and that the gross pay prior to the current week totaled $68,000. Assume further that the social security tax rate was 6.0%, the Medicare tax rate was 1.5%, and the federal income tax to be withheld was $650. (a) Determine the gross pay for the week. : Calculation Regular pay Overtime pay Gross pay Amount Problem Two cont. (b) Determine the net pay for the week. Calculation Gross pay Amount From previous page Social security tax Medicare tax Federal withholding Net pay (c) Journalize the recording of the payroll assuming the payroll was recorded on April 30, 2020 JOURNAL DATE ITEM Page XX PR Problem Three List four internal controls that relate directly to payroll. DEBIT CREDIT