Question: Part A Blue Blaze Company whose fiscal year ends December

Part A: Blue Blaze Company, whose fiscal year ends December 31, completed the following transactions involving notes payable:
Nov. 25 Purchased a new loading cart by issuing a 60-day 10 percent note for $43,200.
Dec. 31 Made the end-of-year adjusting entry to accrue interest expense. (Round to the nearest cent.)
Jan. 24 Paid off the loading cart note. (Round to the nearest cent.)

1. Prepare journal entries for Blue Blaze’s notes payable transactions.
2. When notes payable appears on the balance sheet, what other current liability would you look for to be associated with the notes?
What would it mean if this other current liability did not appear?

Part B: At the end of October, the payroll register for Blue Blaze Company contained the following totals: wages, $92,750; federal income taxes withheld, $23,721; state income taxes withheld, $3,909; Social Security tax withheld, $5,751; Medicare tax withheld, $1,345; medical insurance deductions, $3,200; and wages subject to unemployment taxes, $57,240.

Prepare journal entries to record the (1) monthly payroll and (2) employer payroll expenses, assuming Social Security and Medicare taxes equal to the amount for employees, a federal unemployment insurance tax of 0.8 percent, a state unemployment tax of 5.4 percent, and medical insurance premiums for which the employer pays 80 percent of the cost.

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  • CreatedMarch 26, 2014
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