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166 the payroll summary for december 31 for wick co revealed total earnings of 80 00 4297149

 

166. The payroll summary for December 31 for Wick Co. revealed total earnings of $80,000.  Earnings subject to 6% social security tax were $50,000; earnings subject to 1.5% Medicare tax were $80,000; and earnings of $3,000 were subject to 4.3% state and 0.8% federal unemployment compensation tax.  Journalize the entry to record the accrual of payroll taxes. 

167. Jackson Hole Construction installs swimming pools. They calculate that warranty obligations are 3% of gross sales. For the year just ending Jackson Hole’s gross sales were $1,450,000.00. Due to previous quarter recognitions, the Warranty Liability account has a credit balance of $28,700.00. Determine the year’s total warranty liability and journalize any necessary value to establish the year’s liability at December 31st. 

168. Jason Construction installs swimming pools. They calculate that warranty obligations are 5% of gross sales. For the year just ending Jason’s gross sales were $1,500,000. Due to previous quarter recognitions, the Warranty Liability account has a credit balance of $48,700. Determine the year’s total warranty liability and journalize any necessary value to establish the year’s liability at December 31st. 

169. On October 1, Reynolds Co. signed a $90,000, 60-day discounted note at the bank. The discount rate was 6%, and the note was paid on November 30.
 

(a)Journalize the entries for October 1 and November 30.

(b)Assume that Reynolds Co. signed a 6% note. Journalize the entries for October 1 and November 30.

(c)Which of the two options is more favorable and why?

170. Journalize the following entries on the books of the borrower and creditor.  Label accordingly.
 

Jun. 1Roberts Co. purchased merchandise on account from Wright Co., $60,000, terms n/30.

Jun. 30Roberts Co. issued a 60-day, 5% note for $60,000 on account.

Aug. 29Roberts Co. paid the amount due.

 

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