Chapter 9: Q14DQ (page 428)
Refer to Apple’s balance sheet in Appendix A. What is the amount of Apple’s accounts payable as of September 26, 2015?
Apple’s balance sheet showed a balance of accounts payable of $35,490as of September 26, 2015.
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Prepare any necessary adjusting entries at December 31, 2017, for Maxum Company’s year-end financial
Statements for each of the following separate transactions and events.
1. Employees earn vacation pay at a rate of one day per month. During December, 20 employees qualify
for one vacation day each. Their average daily wage is \(160 per employee.
2. During December, Maxum Company sold 12,000 units of a product that carries a 60-day warranty.
December sales for this product total \)460,000. The company expects 10% of the units to need warrantyrepairs, and it estimates the average repair cost per unit will be $15.
What is an estimated liability?
SP 9 Review the February 26 and March 25 transactions for Business Solutions (SP 4) from Chapter 4.
Required
1. Assume that Lyn Addie is an unmarried employee. Her \(1,000 of wages are subject to no deductions other than FICA Social Security taxes, FICA Medicare taxes, and federal income taxes. Her federal income taxes for this pay period total \)159. Compute her net pay for the eight days’ work paid on February 26. (Round amounts to the nearest cent.)
2. Record the journal entry to reflect the payroll payment to Lyn Addie as computed in part 1.
3. Record the journal entry to reflect the (employer) payroll tax expenses for the February 26 payroll payment. Assume Lyn Addie has not met earnings limits for FUTA and SUTA (the FUTA rate is 0.6% and the SUTA rate is 4% for the company. (Round amounts to the nearest cent.)
4. Record the entry(ies) for the merchandise sold on March 25 if a 4% sales tax rate applies.
Suppose a company has a facility located where disastrous weather conditions often occur. Should it report a probable loss from a future disaster as a liability on its balance sheet? Explain.
Question On January 8, the end of the first weekly pay period of the year, Regis Company’s payroll register showed
that its employees earned \(22,760 of office salaries and \)65,840 of sales salaries. Withholdings from the
employees’ salaries include FICA Social Security taxes at the rate of 6.2%, FICA Medicare taxes at the
rate of 1.45%, \(12,860 of federal income taxes, \)1,340 of medical insurance deductions, and \(840 of
union dues. No employee earned more than \)7,000 in this first period.
Required
1. Calculate FICA Social Security taxes payable and FICA Medicare taxes payable. Prepare the journal
entry to record Regis Company’s January 8 (employee) payroll expenses and liabilities. (Round
amounts to cents.)
2. Prepare the journal entry to record Regis’s (employer) payroll taxes resulting from the January 8 payroll.
Regis’s merit rating reduces its state unemployment tax rate to 4% of the first $7,000 paid each
employee. The federal unemployment tax rate is 0.6%. (Round amounts to cents.)
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