ACC 205 WEEK 4 EXERCISE ASSIGNMENT LIABILITY(NEW)/Uoptutorial

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a. Prepare the necessary entry to record Brookhaven’s February payroll. The entry will include deductions for the following: • Social Security taxes • Medicare taxes • Federal income taxes withheld • State income taxes • Insurance withholdings b. Prepare the journal entry to record Brookhaven’s payroll tax expense. The entry will include the following: • Matching Social Security taxes • Matching Medicare taxes • State unemployment taxes • Federal unemployment taxes 3. Current liabilities: entries and disclosure. A review of selected financial activities of Visconti’s during 20XX disclosed the following: 12/1 Borrowed $20,000 from the First City Bank by signing a 3- month, 15% note payable. Interest and principal are due at maturity. 2/10 Established a warranty liability for the XY-80, a new product. Sales are expected to total 1,000 units during the month. Past experience with similar products indicates that 2% of the units will require repair, with warranty costs averaging $27 per unit. 12/22 Purchased $16,000 of merchandise on account from Oregon Company, terms 2/10, n/30. 12/26 Borrowed $5,000 from First City Bank; signed a note payable due in 60 days. 12/31
Repaired six XY-80s during the month at a total cost of $162. 12/31 Accrued 3 days of salaries at a total cost of $1,400. Instructions a. Prepare journal entries to record the transactions. b. Prepare adjusting entries on October 31 to record accrued interest. c. Prepare the Current Liability section of Red Bank’s balance sheet as of October 31. Assume that the Accounts Payable account totals $203,600 on this date. 4. Issuance of stock: organization costs. Snowbound Corporation was incorporated in July. The firm’s charter authorized the sale of 200,000 shares of $10 par-value common stock. The following transactions occurred during the year: 7/1: Sold 45,000 shares of common stock to investors for $18 per share. Cash was collected and the shares were issued. 8/11 Sold 20,000 shares to investors for $22 per share. Cash was collected and the shares were issued. 9/1 Declared a cash dividend on 9/1 for $1.00 a share for shareholders on record 10/1 with payment being made on 11/1. Instructions a. Prepare journal entries for the two stock issues. b. Prepare journal entries for the cash dividend declaration and payment. 5. Notes payable. Red Bank Enterprises was involved in the following transactions during the fiscal year ending October 31: 8/2: Borrowed $75,000 from the Bank of Kingsville by signing a 120-day note. 8/20:
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ACC 205 WEEK 4 EXERCISE ASSIGNMENT LIABILITY(NEW)/Uoptutorial

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