ACCT 211 Homework 9 Current Liabilities Problems Assignment solutions complete answers

ACCT 211 Homework 9 Current Liabilities Problems Assignment solutions complete answers 

 

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Tyrell Company entered into the following transactions involving short-term liabilities.
 
Year 1

April 20
Purchased $38,500 of merchandise on credit from Locust, terms n/30.
May 19
Replaced the April 20 account payable to Locust with a 90-day, 8%, $35,000 note payable along with paying $3,500 in cash.
July 8
Borrowed $57,000 cash from NBR Bank by signing a 120-day, 10%, $57,000 note payable.
__?__
Paid the amount due on the note to Locust at the maturity date.
__?__
Paid the amount due on the note to NBR Bank at the maturity date.
November 28
Borrowed $24,000 cash from Fargo Bank by signing a 60-day, 7%, $24,000 note payable.
December 31
Recorded an adjusting entry for accrued interest on the note to Fargo Bank.
 
Year 2
 

__?__
Paid the amount due on the note to Fargo Bank at the maturity date.
Required:
1. Determine the maturity date for each of the three notes described.

 

2. Determine the interest due at maturity for each of the three notes. (Do not round intermediate calculations and round your final answer to nearest whole dollar. Use 360 days a year.)

 

3. Determine the interest expense recorded in the adjusting entry at the end of Year 1. (Do not round intermediate calculations and round your final answer to nearest whole dollar. Use 360 days a year.)

 

4. Determine the interest expense recorded in Year 2. (Do not round intermediate calculations and round your final answers to nearest whole dollar. Use 360 days a year.)

 

5. Prepare journal entries for all the preceding transactions and events. (Do not round your intermediate calculations.)

 

On January 8, the end of the first weekly pay period of the year, Regis Company's employees earned $22,760 of office salaries and $60,840 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%, $13,360 of federal income taxes, $1,460 of medical insurance deductions, and $820 of union dues. No employee earned more than $7,000 in this first period.
 
Required:
1-a. Calculate below the amounts for each of these four taxes of Regis Company. Regis’s state unemployment tax rate is 5.4% of the first $7,000 paid to each employee. The federal unemployment tax rate is 0.6%.
1-b. Prepare the journal entry to record Regis Company's January 8 employee payroll expenses and liabilities.
2. Prepare the journal entry to record Regis’s employer payroll taxes resulting from the January 8 payroll. Regis’s state unemployment tax rate is 5.4% of the first $7,000 paid to each employee. The federal unemployment tax rate is 0.6%.

 

Paloma Company has four employees. FICA Social Security taxes are 6.2% of the first $137,700 paid to each employee, and FICA Medicare taxes are 1.45% of gross pay. Also, for the first $7,000 paid to each employee, the company’s FUTA taxes are 0.6% and SUTA taxes are 5.4%. The company is preparing its payroll calculations for the week ended August 25. Payroll records show the following information for the company’s four employees.
 

 
Current Week
Name
Gross Pay through August 18
Gross Pay
Income Tax Withholding
Dali
$ 124,000
$ 4,900
$ 582
Trey
134,900
2,800
290
Kiesha
9,200
1,800
57
Chee
3,150
1,600
46
 
In addition to gross pay, the company must pay one-half of the $102 per employee weekly health insurance; each employee pays the remaining one-half. The company also contributes an extra 8% of each employee’s gross pay (at no cost to employees) to a pension fund.
 
Required:
Compute the following for the week ended August 25. (Round your intermediate calculations and final answers to 2 decimal places.):

 

On October 29, Lobo Company began operations by purchasing razors for resale. The razors have a 90-day warranty. When a razor is returned, the company discards it and mails a new one from Merchandise Inventory to the customer. The company's cost per new razor is $15 and its retail selling price is $60. The company expects warranty costs to equal 6%  of dollar sales. The following transactions occurred.
 

November 11
Sold 60 razors for $3,600 cash.
November 30
Recognized warranty expense related to November sales with an adjusting entry.
December 9
Replaced 12 razors that were returned under the warranty.
December 16
Sold 180 razors for $10,800 cash.
December 29
Replaced 24 razors that were returned under the warranty.
December 31
Recognized warranty expense related to December sales with an adjusting entry.
January 5
Sold 120 razors for $7,200 cash.
January 17
Replaced 29 razors that were returned under the warranty.
January 31
Recognized warranty expense related to January sales with an adjusting entry.
Required:
1. Prepare journal entries to record above transactions and adjustments.

 

2. How much warranty expense is reported for November and for December?

 

3. How much warranty expense is reported for January?

 

4. What is the balance of the Estimated Warranty Liability account as of December 31?

 

5. What is the balance of the Estimated Warranty Liability account as of January 31?

 

Shown here are condensed income statements for two different companies (assume no income taxes).
 

Miller Company
Sales
$ 1,250,000
Variable expenses (80%)
1,000,000
Income before interest
250,000
Interest expense (fixed)
76,000
Net income
$ 174,000
 

Weaver Company
Sales
$ 1,250,000
Variable expenses (60%)
750,000
Income before interest
500,000
Interest expense (fixed)
326,000
Net income
$ 174,000
Required:
1. Compute times interest earned for Miller Company and for Weaver Company.