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Accounting 7th Edition Charles T. Horngren, Walter T. Harrison - Solutions
Harley-Davidson, Inc., the motorcycle manufacturer, included the following note (adapted) in its annual report:1. Why are these contingent (versus real) liabilities?2. How can a contingent liability become a real liability for HarleyDavidson? What are the limits to the company's product liabilities
Grant Teiman is paid \(\$ 640\) for a 40 -hour workweek and time-and-a-half for hours above 40.1. Compute Teiman's gross pay for working 50 hours during the first week of February.2. Teiman is single, and his income tax withholding is \(10 \%\) of total pay. Teiman's only payroll deductions are
Suppose you work for KPMG, the accounting firm, all year and earn a monthly salary of \(\$ 6,000\). There is no overtime pay. Your withheld income taxes consume \(15 \%\) of gross pay. In addition to payroll taxes, you elect to contribute \(5 \%\) monthly to your retirement plan. KPMG also deducts
Refer to Blumenthal's payroll record in Exhibit 11-6.1. How much was the company's total salary expense for the week?2. How much cash did the employees take home for their work?3. How much did employees pay this week fora. Federal income tax?b. FICA tax?Exhibit 11-6 Week Ended December 31, 2007
What are some of the important elements of good internal control to safeguard payroll disbursements?
Citadel Sporting Goods' payroll record for the week ended June 30, 3 2007 , included these totals:In addition to the payroll liabilities shown here, Citadel has the following current liabilities at June 30, 2007:Prepare the current liabilities section of Citade's balance sheet at June 30 , 2007.
TransWorld Publishing completed the following transactions during 2008:Journalize these transactions (explanations are not required). Then report the liability' on the company's balance sheet at December 31, 2008. Oct. 1 Sold a six-month subscription, collecting cash of $200, plus sales tax of 9%.
The accounting records of Durango Ceramics included the following at December 31, 2007:In the past, Durango's warranty expense has been \(6 \%\) of sales. During 2008 , Durango made sales of \(\$ 100,000\) and paid \(\$ 7,000\) to satisfy warranty claims.Requirements 1. Journalize Durango's
Cappy Scanlan manages the women's sportswear department of Parisian Department Store in Seattle. She earns a base monthly salary of \(\$ 750\) plus a \(10 \%\) commission on her personal sales. Through payroll deductions, Scanlan donates \(\$ 25\) per month to a charitable organization, and she
Harold Sollenberger manages a Dairy Queen drive-in. His straight-time pay is \(\$ 10\) per hour, with time-and-a-half for hours in excess of 40 per week. Sollenberger's payroll deductions include withheld income tax of \(9 \%\), FICA tax of \(8 \%\), and a weekly deduction of \(\$ 5\) for a
Saturn Solartech has annual salary expense of \(\$ 450,000\). In addition, Saturn incurs payroll tax expense equal to \(10 \%\) of the total payroll. At December 31, Saturn owes salaries of \(\$ 8,000\) and payroll taxes of \(\$ 2,000\).Requirement Show what Saturn will report for these facts on
Optical Dispensary borrowed \$300,000 on January 2, 2007, by issuing a \(10 \%\) note payable that must be paid in three equal annual installments plus interest for the year. The first payment of principal and interest comes due January \(2,2008\).Requirement Insert the appropriate amounts to show
Oriental Rug Company completed these selected transactions during December 2006, its first month of operations.a. Sales of \(\$ 200,000\) are subject to estimated warranty cost of \(3 \%\).b. Pier 1 Imports ordered \(\$ 15,000\) of rugs. With its order, Pier 1 sent a check for \(\$ 15,000\) in
The comparative balance sheet of Paladin Security Services for two years reported these figures:Compute Paladin's current ratio and debt ratio for both years. Did the ratios improve or deteriorate in 2006? Compute the debt ratio to 3 decimal places. 2006 Total current assets. $ 4,600 Noncurrent
The following transactions of Lexington Pharmacies occurred during 2006 and 2017:Requirement Record the transactions in Lexington's general journal. Explanations are not required. 2006 Jan. 9 Purchased computer equipment at a cost of $8,000, signing a six-month, 8% note payable for that amount.
The records of Georgia Tea \& Coffee Company show the following figures:Requirements 1. Determine missing amounts (a) through (d).2. Journalize this payroll for the month. No explanation is required. Employee Earnings Straight-time earnings....... $16,400 Overtime pay.. (a) Total employee
Felix McKay is general manager of Moonwalk Tanning Salons. During 2008, McKay worked for the company all year at a \(\$ 6,625\) monthly salary. He also earned a year-end bonus equal to \(10 \%\) of his salary.McKay's federal income tax withheld during 2008 was \(\$ 737\) per month, plus \(\$ 924\)
The payroll records of Navasota Video Productions provide the following information for the weekly pay period ended December 29, 2007:Employees are paid wages at the rate of time-and-a-half for hours over 40 per week. Round all amounts to the nearest dollar, and show your computations. Explanations
Morrison's Gifts' accounting records provide the following liability data at year-end:a. Sales of \(\$ 400,000\) were covered by Morrison's product warranty. At January 1 , estimated warranty payable was \(\$ 3,000\). During the year, Morrison recorded warranty expense of \(\$ 12,000\) and paid
The following transactions of Pan-American Paper Company occurred during 2006 and 2007.Requirement Record the transactions in Pan American's general journal. Explanations are not required. 2006 Feb. 3 Purchased equipment for $40,000, signing a six-month, 9% note payable. 28 Recorded the week's
The records of Lyndon Olson Political Consultants show the following figures:Requirements 1. Determine missing amounts (a) through (d). 2. Journalize Olson's payroll for the month. No explanation is required. Employee Earnings Straight-time earnings...... S (a) Overtime pay. 5,000 Total employee
Louann Winters is a vice president at Crossroads Bank. During 2008, Winters worked for the bank all year at a \(\$ 6,500\) monthly salary. She also earned a year-end bonus equal to \(15 \%\) of her annual salary.Winters' federal income tax withheld during 2008 was \(\$ 820\) per month, plus \(\$
The Northwood Inn general ledger at September 30, 2008, the end of the company's fiscal year, includes the following account balances before adjusting entries.The additional data needed to develop the adjusting entries at September 30 are as follows:a. The long-term note payable is payable in
The payroll records of Carolina Home Improvements provide the following information for the weekly pay period ended December 29, 2007:All employees are paid time-and-a-half for hours worked in excess of 40 per week.Requirements Round all amounts to the nearest dollar, and show your computations.
Following are pertinent facts about events during the current year at Lafferty Trailers.a. December sales totaled \(\$ 300,000\), and Lafferty collected sales tax of \(5 \%\). The sales tax will be sent to the state of Virginia early in January. b. Sales are covered by a I afferty product
Jack Delaney is the accountant responsible for customer accounts in the accounts receivable subsidiary ledger. What duty will a good internal control system withhold from Delaney? Why?
During its first year of operations, Signature Lamp Company earned revenue of \(\$ 350,000\) on account. Industry experience suggests that bad debts will amount to \(2 \%\) of revenues. At December 31, 2008, accounts receivable total \(\$ 40,000\). The company uses the allowance method to account
During 2009, Signature Lamp Company completed these transactions:1. Sales revenue on account, \(\$ 400,000\) (ignore cost of goods sold). 2. Collections on account, \(\$ 420,000\). 3. Write-offs of uncollectibles, \(\$ 6,000\). 4. Uncollectible-account expense, \(2 \%\) of sales revenue.
Interstate Marble Importers had the following balances at December 31, 2007 , before the year-end adjustments:The aging of accounts receivable yields these data:1. Journalize Interstate's entry to adjust the allowance account to its correct balance at I)ecember 31, 2007.2. Prepare a T-account to
Bob Rassler is an attorney in I.os Angeles. Rassler uses the direct writeoff method to account for uncollectible receivables.At May 31, Rassler's accounts receivable totaled \(\$ 14,000\). During June, he earned revenue of \(\$ 20,000\) on account and collected \(\$ 19,000\) on account. He also
Restaurants do a large volume of business by credit cards and bankcards.Suppose a Chili's restaurant had these transactions on a Saturday:Suppose American Express charges merchants \(2 \%\) and VISA charges \(11 / 2 \%\). Record these sale transactions for the restaurant. American Express
Lantana Bank & Trust Company lent $100,000 to Ben Milam on a 90-day, 10% note. Record the following transactions for the hank (explanations are not required):a. Lending the money on May 6. b. Collecting the principal and interest at maturity. Specify the date. For the computation of interest, use
Concentra Medical Center included the following items in its financial statements:1. How much net income did Concentra earn for the month?Show two ways Concentra can report receivables on its classified balance sheet. Allowance for doubtful accounts $ 120 Service revenue Cash 1,150 Other assets
Avant Garde Clothiers reported the following items at February 28, 2008 (amounts in thousands, with last year's — 2007 — amounts also given as needed):Compute Avant Garde's(a) acid-test ratio (b) days' sales in average receivables for 2008. Evaluate each ratio value as strong or weak. Avant
Use the data in Short Exercise 9-12 to compute the following 2008 ratios for Avant Garde Clothiers. Round decimals to two places.a. Current ratio b. Debt ratio c. Gross profit percentage d. Rate of inventory turnover.Exercise 9-12Avant Garde Clothiers reported the following items at February 28,
At September 30, Eagle Mountain Flagpoles had Accounts Receivable of \(\$ 28,000\) and Allowance for Uncollectible Accounts of \(\$ 1,000\). During October, Eagle Mountain recorded- Sales of \(\$ 180,000\) ( \(\$ 160,000\) on account; \(\$ 20,000\) for cash)- Collections on account, \(\$ 130,000\)-
At December 31, 2008, the Accounts Receivable balance of Easy Card is \(\$ 300,000\). The Allowance for Doubtful Accounts has a \(\$ 8,900\) credit balance. Easy Card prepares the following aging schedule for its accounts receivable:Requirements 1. Journalize the year-end adjusting entry for
High Performance Cell Phones sold \$20,000 of merchandise to Avery Trucking Company on account. Avery fell on hard times and paid only \(\$ 6,000\) of the account receivable. After repeated attempts to collect, High Performance finally wrote off its accounts receivable from Avery. Six months later
On April 30, 2007, Synergy Bank loaned \$80,000 to Kim Sperry on a one-year, \(9 \%\) note.Requirements 1. Compute the interest for the years ended December 31, 2007 and 2008 for the Sperry note.2. Which party has a a. Note receivable?c. Interest revenue?b. Note payable?d. Interest expense?3. How
Journalize the following transactions of Mediterranean Importers, which ends its accounting year on June 30: Apr. 1 June 6 Loaned $10,000 cash to Carroll Fadal on a one-year, 8% note. Sold goods to Turf Masters, receiving a 90-day, 10% note for $9,000. 30 Made a single compound entry to accrue
Record the following transactions in the journal of Top Dog Running Shoes: 2008 Feb. 12 Recorded MasterCard bankcard sales of $100,000, less a 2% discount. Aug. 1 Loaned $20,000 to Jean Porter, an executive with the company, on a one-year, 12% note. Dec. 31 Accrued interest revenue on the Porter
High-Pressure Steam Cleaning performs service on account. When a customer account becomes four months old, High-Pressure converts the account to a note receivable. During 2008 , the company completed these transactions:Requirements Record the transactions in High-Pressure's journal. June 29
Cherokee Carpets reported the following amounts in its 2009 financial statements. The 2008 figures are given for comparison.Requirements 1. Determine whether Cherokee's acid-test ratio improved or deteriorated from 2008 to 2009. How does Cherokee's acid-test ratio compare with the industry average
Mail Plus performs mailing services on account, so virtually all cash receipts arrive in the mail. Gina Star, the owner, has just returned from a meeting with new ideas for the business. Among other things, Star plans to institute stronger internal controls over cash receipts from
On February 28, Tradewinds Sailing Supplies had a \(\$ 75,000\) debit balance in Accounts Receivable and a \(\$ 2,200\) credit balance in Allowance for Uncollectible Accounts. During March, Tradewinds made- Sales on account, \(\$ 410,000\)- Collections on account, \(\$ 419,000\)- Write-offs of
At September 30, the accounts of Aguilar Outsourcing Solutions include the following:During the last quarter of 2009, Aguilar completed the following selected transactions:Requirements 1. Record the transactions in the journal. 2. Open the Allowance for Uncollectible Accounts, and post entries
Showbiz Sportswear completed the following selected transactions during 2008 and 2009:Requirements 1. Open general ledger accounts for Allowance for Uncollectible Accounts and Uncollectible-Account Expense. Keep running balances. All accounts begin with a zero balance. 2. Record the transactions
Record the following transactions in the general journal of Dvorak Interiors. Round all amounts to the nearest dollar. Explanations are not required. 2007 Dec. 21 Received a $4,400, 30-day, 9% note on account from Monica Lee. 2008 31 31 Made an adjusting entry to accrue interest on the Lee note.
Speedo Paint Company completed the following selected transactions:Requirement Record the transactions in the journal of Speedo Paint Company. Explanations are not required. Using ratio data to evaluate a company's financial position 2007 Dec. 1 2008 31 31 Mar. 1 July 21 Sold inventory to Brent
The comparative financial statements of 4th Gear Website Design for 5 2008,2007 , and 2006 include the data shown here:Requirements 1. Compute these ratios for 2008 and 2007 :a. Current ratiob. Acid-test ratioc. Days' sales in receivables2. Write a memo explaining to Les Arnold, the company owner,
Stained Glass Crafters performs all work on account, with regular monthly billing to customers. M. C. Perry, the accountant, opens the mail. Company procedure requires him to separate customer checks from the remittance slips and then post collections to customer accounts. Perry deposits the checks
On May 31, Rosetree Floral Supply had a \(\$ 160,000\) debit balance in Accounts Receivable and a \(\$ 6,400\) credit balance in Allowance for Uncollectible Accounts. During June, Rosetree made:- Sales on account, \(\$ 560,000\)- Collections on account, \(\$ 601,000\).- Write-offs of uncollectible
At September 30, the accounts of East Terrace Medical Center (ETMC) include the following:During October through December, ETMC completed the following selected transactions:Requirements 1. Record the transactions in the journal.2. Open the Allowance for Uncollectible Accounts, and post entries
Dialex Watches completed the following transactions during 2007 and 2008:Requirements 1. Open general ledger accounts for Allowance for Uncollectible Accounts and Uncollectible-Account Expense. Keep running balances. All accounts begin with a zero balance. 2. Record the transactions in the general
Bank of Nashville received the following notes during 2008.Requirements For each note compute interest using a 360 -day year. Explanations are not required.1. Determine the due date and maturity value of each note.2. Journalize a single adjusting entry at December 31,2008 , to record accrued
Record the following transactions in the general journal of Renschler Communication. Explanations are not required. 2007 Dec. 19 Received a $5,000, 60-day, 12% note on account from Video 2008 Productions. 31 Made an adjusting entry to accrue interest on the Video Productions note. 31 Made a
Assume that La-Z Recliner Chairs completed the following selected transactions:Requirement Record the transactions in the journal of La-Z Recliner Chairs. Explanations are not required. 2007 July 1 Sold goods to Wal-Mart, receiving a $40,000, 9-month, 9% note. Ignore cost of goods sold. Dec. 31
FedEx bought two used Boeing airplanes. Each plane was worth \(\$ 35\) million, but the owner sold the combination for \(\$ 60\) million. How much is FedEx's cost of each plane?a. \(\$ 60\) millionb. \(\$ 70\) millionc. \(\$ 30\) milliond. \(\$ 35\) million
Which depreciation method would you prefer to use for income tax purposes? Why?a. Straight-line because it is simplestb. Units-of-production because it best tracks the asset's usec. Double-declining-balance because it gives the fastest tax deductions for depreciationd. Double-declining-balance
A copy machine cost \(\$ 40,000\) when new and has accumulated depreciation of \(\$ 35,000\). Suppose Kinko's junks this machine, receiving nothing. What is the result of the disposal transaction?a. No gain or lossb. Gain of \(\$ 5,000\)c. Loss of \(\$ 35,000\)d. Loss of \(\$ 5,000\)
Suppose Kinko's in the preceding question sold the machine for \(\$ 5,000\). What is the result of this disposal transaction?a. Gain of \(\$ 2,000\)b. Loss of \(\$ 2,000\)c. Gain of \(\$ 3,000\)d. No gain or loss
Which method is used to compute depletion?a. Depletion methodb. Units-of-production methodc. Straight-line methodd. Double-declining-balance method
At the beginning of the year, Texas Aero purchased a used Boeing jet for \(\$ 35,000,000\). Texas Aero expects the plane to remain useful for five years ( 6 million miles) and to have a residual value of \(\$ 5,000,000\). The company expects the plane to be flown 1 million miles the first year.1.
At the beginning of 2007, Texas Aero purchased a used Boeing jet at a cost of \(\$ 35,000,000\). Texas Aero expects the plane to remain useful for five years ( 6 million miles) and to have a residual value of \(\$ 5,000,000\). Texas Aero expects the plane to be flown 1 million miles the first year
On March 31, 2008, FedEx Kinko's purchased a Xerox copy machine for \(\$ 80,000\). FedEx Kinko's expects the machine to last for five years and to have a residual value of \(\$ 8,000\). Compute depreciation on the machine for the year ended December 31, 2008, using the straight-line method.
Assume that the Chicago Cubs baseball organization paid \(\$ 50,000\) for a hot dog stand with a 10 -year life and zero expected residual value. After using the hot dog stand for four years, the company determines that the asset will remain useful for only two more years. Record depreciation on the
Return to the American Airlines baggage-handling truck in Exhibit 10-7. Suppose American sold the truck on December 31, 2009, for \(\$ 28,000\) cash, after using the truck for two full years. Depreciation for 2009 has been recorded. Make the journal entry to record American's sale of the truck.
Air \& Sea Travel purchased a Dell Computer for \(\$ 3,000\), debiting Computer Equipment. During 2007 and 2008, Air \& Sea recorded depreciation of \$2,200 on the computer. In January 2009, Air \& Sea traded in the computer for a new one, paying \(\$ 2,500\) cash. Journalize Air \(\&\) Sea
British Petroleum (BP) holds huge reserves of oil and gas assets. Assume that at the end of 2006 , BP's cost of oil and gas reserves totaled \(\$ 24\) billion, representing 2.4 billion barrels of oil and gas.1. Which depreciation method does BP use to compute depletion?2. Suppose BP removed 0.5
This exercise summarizes the accounting for patents and for research and development.During 2008, Digital Cable Company paid \(\$ 50,000\) to research and develop a new technology, and also purchased a patent for \(\$ 10,000\). Digital's service revenue for 2008 totaled \(\$ 700,000\), and selling
Trautschold Furniture Co. purchased land, paying \(\$ 80,000\) cash plus a \(\$ 300,000\) note payable. In addition, Trautschold paid delinquent property tax of \(\$ 2,000\), title insurance costing \(\$ 3,000\), and \(\$ 5,000\) to level the land and remove an unwanted building. The company then
Northwood Properties bought three lots in a subdivision for a lump-sum price. An independent appraiser valued the lots as follows:Northwood paid \(\$ 150,000\) in cash. Record the purchase in the journal, identifying each lot's cost in a separate Land account. Round decimals to three places, and
Pulley-Bone Fried Chicken bought equipment on January 2, 2007, for \(\$ 15,000\). The equipment was expected to remain in service 4 years and to perform 3,000 fry jobs. At the end of the equipment's useful life, PulleyBone estimates that its residual value will be \(\$ 3,000\). The equipment
Flips Gymnastics Center paid \(\$ 140,000\) for fitness equipment that is expected to have a 10 -year life. The expected residual value is \(\$ 40,000\).Select the appropriate MACRS depreciation method for income tax purposes. Then determine the extra amount of depreciation that Flips can deduct by
A-1 Security Consultants purchased a building for \(\$ 500,000\) and depreciated it on a straight-line basis over a 40 -year period. The estimated residual value was \(\$ 100,000\). After using the building for 15 years, \(\mathrm{A}-1\) realized that wear and tear on the building would wear it out
On January 2, 2006, Ditto Clothing Consignments purchased showroom fixtures for \(\$ 10,000\) cash, expecting the fixtures to remain in service 5 years. Ditto has depreciated the fixtures on a double-declining-balance basis, with zero residual value. On September 30, 2007, Ditto sold the fixtures
Covenant Trucking Company uses the units-of-production (UOP) depreciation method because UOP best measures wear and tear on the trucks. Consider these facts about one Mack truck in the company's fleet.When acquired in 2006 , the rig cost \(\$ 350,000\) and was expected to remain in service for 10
PepsiCo, Inc., has acquired several other companies. Assume that PepsiCo purchased Kettle Chips Co. for \(\$ 8\) million cash. The book value of Kettle Chips' assets is \(\$ 12\) million (market value, \(\$ 15\) million), and it has liabilities of \(\$ 10\) million.Requirements 1. Compute the cost
The board of directors of Park Place Porsche is having a quarterly meeting. Accounting policies are on the agenda, and depreciation is being discussed. A new board member, an attorney, has some strong opinions about two aspects of depreciation policy. Jennifer Axelrod argues that depreciation must
On January 2, 2006, Speedway: Delivery Service purchased a truck at a cost of \(\$ 63,000\). Before placing the truck in service, Speedway spent S2,200 painting it, \(\$ 800\) replacing tires, and \(\$ 4,000\) overhauling the engine. The truck should remain in service for 6 years and have a
On May 31, 2004, FedEx, the overnight shipper, had total assets of \(\$ 19\) billion and total liabilities of \(\$ 11\) billion. Included among the assets were property, plant, and equipment with a cost of \(\$ 20\) billion and accumulated depreciation of \(\$ 11\) billion. During the year ended
Vandergiff Jewelry incurred the following costs to acquire land, make land improvements, and construct and furnish a new building.Vandergriff depreciates land improvements over 20 years, buildings over 40 years, and furniture over 8 years, all on a straight-line basis with zero residual
The accounts of Haley-Davis Printing Company include Land, Buildings, and Equipment. Haley-Davis has a separate accumulated depreciation account for each asset. During 2007 , the company completed the following transactions:Requirement Record the transactions in Haley-Davis's journal. Jan. 1
The board of directors of Computer Solutions is reviewing the 2007 annual repothat has not occurred. Further, growth in the city is increasing the values of property. He asks why the company is recording depreciation when property values are rising.Requirement Write a paragraph or two to explain
On January 3, 2007, Joe Griffin Photography paid \(\$ 224,000\) for photo equipment. In addition to the purchase price, Griffin paid \(\$ 700\) transportation charges, \(\$ 100\) insurance for the equipment while in transit, \(\$ 12,100\) sales tax, and \(\$ 3,100\) for specialized training to be
RKI Properties' balance sheet includes a natural resource asset, Coal. RKI paid \(\$ 600,000\) cash for the right to work a mine with an estimated 100,000 tons of coal. The company paid \(\$ 60,000\) to remove unwanted buildings and \(\$ 40,000\) to prepare the surface for mining. RKI also signed a
The balance sheet of MBC Television reports intangible assets. Assume that MBC purchased the intangibles as part of the acquisition of another company, which carried these figures:Requirements 1. Make the journal entry to record MBC's purchase of the other company for \(\$ 1,000,000\), half in
At the end of 2004, PepsiCo had total assets of \(\$ 28\) billion and total liabilities of \(\$ 14\) billion. Included among the assets were property, plant, and equipment with a cost of \(\$ 16\) billion and accumulated depreciation of \(\$ 8\) billion. During 2004, PepsiCo earned total revenues
On January 1, 2008, you borrowed \(\$ 10,000\) on a five-year, \(8 \%\) note payable. At December 31, 2009, you should recorda. Interest payable of \(\$ 800\)b. Nothing (The note is already on the books.)c. Note receivable of \(\$ 10,000\)d. Cash payment of 210,000
Your company sells \(\$ 100,000\) of goods and you collect sales tax of \(3 \%\). What current liability does the sale create?a. . Yone; you collected cash up front.b. Unearned revenue of \(\$ 3,000\)c. Sales tax payable of \(S 3,000\)d. Sales revenue of \(\$ 103,000\)
At December 31, your company owes employees for three days of the five-day workweek. The total payroll for the week is \(\$ 8,000\). What journal entry should you make at December 31? a. Nothing, because you will pay the employees on Friday b. Salary Expense........ 4,800 Salary Payable.. 4,800 c.
What is unearned revenue?a. Receivableb. Current assetc. Revenued. Current liability
Payroll expenses includea. Salaries and wagesb. Employee benefitsc. Payroll taxesd. All of the above
What is the most that an employee paid the federal government for old age, survivors', and disability insurance (FICA tax) during 2008?a. \(\$ 5,580\).b. \(\$ 90,000\).c. Nothing. The employer paid it.d. There is no upper limit on FICA tax.
The document that an employer gives each employee at the end of the year to report annual earnings and taxes paid is thea. Form W-2b. Form W-4c. Payroll recordd. Form 941
The foundation of internal control over payroll isa. Paying the correct amount of payroll taxb. Separating payroll dutiesc. Filing government tax forms on timed. Accurately computing gross pay, deductions, and net pay
"Bad debts" are the same asa. Uncollectible accountsc. Neither of the aboveb. Doubeful accountsd. Both \(a\) and \(b\)
Which method of estimating uncollectible receivables focuses on UncollectibleAccount Expense for the income statement?a. Percent-of-sales approachb. Aging-of-accounts approachc. Net-realizable-value approachd. All of the above.
Your company uses the allowance method to account for uncollectible receivables. At the beginning of the year, Allowance for Uncollectibles had a credit balance of \(\$ 1,100\). During the year you recorded Uncollectible-Account Expense of \(\$ 3,000\) and wrote off bad receivables of \(\$ 2,100\).
Your ending balance of Accounts Receivable is \(\$ 20,000\). Use the data in the preceding question to compute the net realizable value of Accounts Receivable at year-end.a. \(\$ 18,000\)b. \(\$ 19,000\)c. \(\$ 20,000\)d. \(\$ 21,000\)
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