Question 1

All of the following are true of known liabilities except:

Accepted Answer

A)  Include accounts payable,notes payable,and payroll.
B)  Are obligations set by agreements,contracts,or laws.
C)  Are measurable.
D)  Are definitely determinable.
E)  May depend on some future event occurring.F) B) and C)
G) A) and D)

Question 2

On September 1,Knack Company signed a $50,000,90-day,5% note payable with Central Savings Bank.What is the journal entry that should be recorded by Knack upon maturity of the note? (Use 360 days a year.)

Accepted Answer

A)  Debit Interest Expense $625; credit Interest Payable $625.
B)  Debit Notes Payable $50,000; credit Interest Revenue $625; credit Cash $49,375.
C)  Debit Cash $50,625; credit Notes Receivable $50,625.
D)  Debit Notes Payable $50,625; credit Cash $50,625.
E)  Debit Notes Payable $50,000; debit Interest Expense $625; credit Cash $50,625.F) A) and D)
G) All of the above

Question 3

Portia Grant is an employee who is paid monthly.For the month of January of the current year,she earned a total of $8,260.The FICA tax for social security is 6.2% of the first $127,200 earned each calendar year and the FICA tax rate for Medicare is 1.45% of all earnings.The FUTA tax rate of 0.6% and the SUTA tax rate of 5.4% are applied to the first $7,000 of an employee's pay.The amount of federal income tax withheld from her earnings was $1,325.17.What is the total amount of taxes withheld from the Portia's earnings? (Round your intermediate calculations to two decimal places.)

Accepted Answer

A)  $3,097.17
B)  $2,443.21
C)  $1,957.06
D)  $1,722.00
E)  $1,495.36F) A) and C)
G) A) and B)

Question 4

Vacation benefits are a type of ________ liability.

Accepted Answer

The answer of Vacation benefits are a type of ________...

Question 5

Calculate the total amount of FICA withholding for an employee whose pay is $2,400 for the first pay period of the year.The tax rate for FICA-Social Security is 6.2% and the tax rate for FICA-Medicare is 1.45%.

Accepted Answer

The answer of Calculate the total amount of FICA withholding...

Question 6

Employer payroll taxes:

Accepted Answer

A)  Are added expenses beyond that for the wages and salaries earned by employees.
B)  Represent the federal taxes withheld from employees.
C)  Represent the social security taxes withheld from employees.
D)  Are paid by the employee.
E)  Are payable for up to a maximum $117,000 of employee earnings.F) A) and E)
G) A) and B)

Question 7

An employer's federal unemployment taxes (FUTA) are reported:

Accepted Answer

A)  Annually.
B)  Semiannually.
C)  Quarterly.
D)  Monthly.
E)  Weekly.F) All of the above
G) A) and B)

Question 8

On December 1,Watson Enterprises signed a $24,000,60-day,4% note payable as replacement of an account payable with Erikson Company.What is the journal entry that should be recorded upon signing the note?

Accepted Answer

A)  Debit Accounts Receivable $24,000; credit Notes Receivable $24,000.
B)  Debit Accounts Payable $24,000; credit Notes Payable $24,000.
C)  Debit Accounts Payable $24,160; credit Notes Payable $24,160.
D)  Debit Notes Payable $24,000; debit Interest Expense $160; credit Accounts Payable $24,160.
E)  Debit Notes Payable $24,000; debit Interest Expense $160; credit Cash $24,160.F) B) and D)
G) A) and E)

Question 9

Obligations not due within one year are reported as current liabilities.

Accepted Answer

A) True 
 B)False

Question 10

The deferred income tax liability:

Accepted Answer

A)  Arises when income tax expense reported on the income statement exceeds the amount of income taxes payable to the government.
B)  Is a contingent liability.
C)  Arises when income tax expense reported on the income statement is less than the amount of income taxes payable to the government.
D)  Is never recorded.
E)  Is recorded whether or not the difference between taxable income and financial accounting income is permanent or temporary.F) C) and D)
G) A) and D)

Question 11

A bank that is authorized to accept deposits of amounts payable to the federal government is a:

Accepted Answer

A)  Credit union.
B)  FDIC insured bank.
C)  Federal depository bank.
D)  National bank.
E)  Federal Reserve Bank.F) B) and C)
G) A) and B)

Question 12

Hollow Company provides you with following information for two of its employees.The company is subject to the following taxes.
  Compute amounts for each of these four taxes as applied to each employee's gross earnings for November.

Accepted Answer

The answer of Hollow Company provides you with following information...

Question 13

________ are amounts received in advance from customers for future products or services.

Accepted Answer

The answer of ________ are amounts received in advance from...

Question 14

A company has fixed interest expense of $5,000,its income before interest expense and income taxes is $17,000,and its net income is $9,400.The company's times interest earned ratio equals:

Accepted Answer

A)  0.5.
B)  1.8.
C)  1.9.
D)  3.4.
E)  0.3.F) A) and B)
G) All of the above

Question 15

The more ________ allowances an employee claims,the less federal income tax the employer will deduct from pay.

Accepted Answer

The answer of The more ________ allowances an employee claims,the...

Question 16

Describe employer responsibilities for reporting payroll taxes.(To the extent possible,reference the form to be filed for each tax.)

Accepted Answer

Employers are required to report FICA ta...

Question 17

Accrued vacation benefits are a form of estimated liability for an employer.

Accepted Answer

A) True 
 B)False

Question 18

The difference between the amount received from issuing a note payable and the amount repaid at maturity is referred to as:

Accepted Answer

A)  Interest.
B)  Principal.
C)  Face Value.
D)  Cash.
E)  Accounts Payable.F) B) and C)
G) A) and E)

Question 19

Explain the responsibilities of and the accounting by employers for deductions from employee payroll.

Accepted Answer

Employers are responsible for collecting...

Question 20

Notes cannot be transferred from party to party because they are nonnegotiable.

Accepted Answer

A) True 
 B)False

Exam 9: Reporting and Analyzing Current Liabilities

The difference between the amount received from issuing a note payable and the amount repaid at maturity is referred to as:

Correct Answer
verified

Obligations not due within one year are reported as current liabilities.

Correct Answer
verified

Hollow Company provides you with following information for two of its employees.The company is subject to the following taxes. Compute amounts for each of these four taxes as applied to each employee's gross earnings for November.

Correct Answer
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Notes cannot be transferred from party to party because they are nonnegotiable.

Correct Answer
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Calculate the total amount of FICA withholding for an employee whose pay is $2,400 for the first pay period of the year.The tax rate for FICA-Social Security is 6.2% and the tax rate for FICA-Medicare is 1.45%.

Correct Answer
verified

An employer's federal unemployment taxes (FUTA) are reported:

Correct Answer
verified

Explain the responsibilities of and the accounting by employers for deductions from employee payroll.

Correct Answer
verified
Employers are responsible for collecting...
View Answer

All of the following are true of known liabilities except:

Correct Answer
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On December 1,Watson Enterprises signed a $24,000,60-day,4% note payable as replacement of an account payable with Erikson Company.What is the journal entry that should be recorded upon signing the note?

Correct Answer
verified

The more ________ allowances an employee claims,the less federal income tax the employer will deduct from pay.

Correct Answer
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A company has fixed interest expense of $5,000,its income before interest expense and income taxes is $17,000,and its net income is $9,400.The company's times interest earned ratio equals:

Correct Answer
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Describe employer responsibilities for reporting payroll taxes.(To the extent possible,reference the form to be filed for each tax.)

Correct Answer
verified
Employers are required to report FICA ta...
View Answer

On September 1,Knack Company signed a $50,000,90-day,5% note payable with Central Savings Bank.What is the journal entry that should be recorded by Knack upon maturity of the note? (Use 360 days a year.)

Correct Answer
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Correct Answer
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A bank that is authorized to accept deposits of amounts payable to the federal government is a:

Correct Answer
verified

The deferred income tax liability:

Correct Answer
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Vacation benefits are a type of ________ liability.

Correct Answer
verified

Accrued vacation benefits are a form of estimated liability for an employer.

Correct Answer
verified

Employer payroll taxes:

Correct Answer
verified

________ are amounts received in advance from customers for future products or services.

Correct Answer
verified

Exam 9: Reporting and Analyzing Current Liabilities

The difference between the amount received from issuing a note payable and the amount repaid at maturity is referred to as:

Correct AnswerverifiedShow Answer

Obligations not due within one year are reported as current liabilities.

Correct AnswerverifiedShow Answer

Hollow Company provides you with following information for two of its employees.The company is subject to the following taxes. Compute amounts for each of these four taxes as applied to each employee's gross earnings for November.

Correct AnswerverifiedShow Answer

Notes cannot be transferred from party to party because they are nonnegotiable.

Correct AnswerverifiedShow Answer

Calculate the total amount of FICA withholding for an employee whose pay is $2,400 for the first pay period of the year.The tax rate for FICA-Social Security is 6.2% and the tax rate for FICA-Medicare is 1.45%.

Correct AnswerverifiedShow Answer

An employer's federal unemployment taxes (FUTA) are reported:

Correct AnswerverifiedShow Answer

Explain the responsibilities of and the accounting by employers for deductions from employee payroll.

Correct AnswerverifiedEmployers are responsible for collecting...View AnswerShow Answer

All of the following are true of known liabilities except:

Correct AnswerverifiedShow Answer

On December 1,Watson Enterprises signed a $24,000,60-day,4% note payable as replacement of an account payable with Erikson Company.What is the journal entry that should be recorded upon signing the note?

Correct AnswerverifiedShow Answer

The more ________ allowances an employee claims,the less federal income tax the employer will deduct from pay.

Correct AnswerverifiedShow Answer

A company has fixed interest expense of $5,000,its income before interest expense and income taxes is $17,000,and its net income is $9,400.The company's times interest earned ratio equals:

Correct AnswerverifiedShow Answer

Describe employer responsibilities for reporting payroll taxes.(To the extent possible,reference the form to be filed for each tax.)

Correct AnswerverifiedEmployers are required to report FICA ta...View AnswerShow Answer

On September 1,Knack Company signed a $50,000,90-day,5% note payable with Central Savings Bank.What is the journal entry that should be recorded by Knack upon maturity of the note? (Use 360 days a year.)

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

A bank that is authorized to accept deposits of amounts payable to the federal government is a:

Correct AnswerverifiedShow Answer

The deferred income tax liability:

Correct AnswerverifiedShow Answer

Vacation benefits are a type of ________ liability.

Correct AnswerverifiedShow Answer

Accrued vacation benefits are a form of estimated liability for an employer.

Correct AnswerverifiedShow Answer

Employer payroll taxes:

Correct AnswerverifiedShow Answer

________ are amounts received in advance from customers for future products or services.

Correct AnswerverifiedShow Answer

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Employers are responsible for collecting...
View Answer

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Employers are required to report FICA ta...
View Answer

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