ACC 205 Week 1,2,3,4,5
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acc_205_week_4_exercise_assignment__-_liability.docxWeek Four Exercise Assignment
Liability
1. Payroll accounting:
a. The entry to record Brookhaven’s February payroll:
Brookhaven Publishing
Journal Entry
For the month February
|
Date |
Particulars |
Debit ($) |
Credit ($) |
|
2/28 |
Salaries Expense Dr. Social Security Taxes Payable Cr. Medicare TaxesPayable Cr. Federal Income Taxes WithholdingsPayableCr. State Income Taxes PayableCr. Insurance Withholdings PayableCr. Salaries payable |
50,000 |
2,000 750 7,500 2,000 500 37,250 |
b. The journal entry to record Brookhaven’s payroll tax expense:
Brookhaven Publishing
Journal Entry
For the month February
|
Date |
Particulars |
Debit ($) |
Credit ($) |
|
2/28 |
Payroll Tax Expense Dr. Social Security Taxes Payable Cr. Medicare Taxes Payable Cr. State Unemployment Taxes Payable Cr. Federal Unemployment TaxesPayable Cr. |
5,850
|
2,000 750 2,700 400 |
Federal Unemployment Taxes= 50000* .8%=400
2. Current liabilities:
a. Journal entries to record the transactions:
Visconti’s
Journal Entries
For the year20XX,December 31
|
Date |
Particulars |
Debit ($) |
Credit ($) |
|
12/1 |
Bank A/C Dr. Notes Payable- First City Bank Cr. |
10,000 |
10,000 |
|
12/10 |
Warranty Expense Dr. Warranty Liability Cr. |
810 |
810 |
|
12/22 |
Merchandise Inventory Dr. Accounts Payables- Oregon CompanyCr. |
16,000 |
16,000 |
|
12/26 |
Bank A/C Dr. Notes Payable- First City Bank Cr. |
5,000 |
5,000 |
|
12/31 |
Warranty Liability Dr. Cash Cr. |
162
|
162 |
|
12/31 |
Salaries Expense Dr. Accrued Salaries Expense Cr. |
1,400 |
1,400 |
b. Prepare adjusting entries on October 31 to record accrued interest:
Visconti’s
Adjusting Entries
For the year 20XX, December 31
|
Date |
Particulars |
Debit ($) |
Credit ($) |
|
12/31 |
Interest Expense Dr. (125+62.5) Accrued Interest Expense Cr. |
187.5 |
187.5 |
c. The Current Liability section of Red Bank’s balance sheet as of October 31:
Visconti’s
Balance Sheet
As of December 31, 20XX
|
Current Liabilities |
Amounts ($) |
Amounts ($) |
|
Accounts Payable Add: New Notes Payable Add: New Accrued Interest Expense Warranty Liability Accrued Salaries Expense |
203,600 16,000 10,000 5,000 |
219,600
15,000 187.5 648 1,400 |
|
Total Current Liabilities |
|
236835.5 |
3. Notes payable:
a. Journal entries to record the transactions:
Red Bank Enterprises
Journal Entries
For the year ending October 31
|
Date |
Particulars |
Debit ($) |
Credit ($) |
|
8/2 |
Bank A/C Dr. Notes Payable- Kingsville Cr. |
55,000 |
55,000 |
|
8/20 |
Delivery Truck Dr. Notes Payables- Harris Motors Cr. |
50,000 |
50,000 |
|
9/10 |
Merchandise Inventory Dr. Notes Payables- Pans Enterprises Cr. |
15,000 |
15,000 |
|
9/11 |
Accounts Payables Dr. Notes Payables- Datatec Equipment Cr. |
60,000 |
60,000 |
|
10/10 |
Notes Payables- Pans Enterprises Dr. Interest Expense Dr. Bank A/C Cr. |
15,000 150 |
15,150 |
|
10/11 |
Notes Payables- Datatec Equipment Dr. Interest Expense Dr. Bank A/C Cr. |
60,000 700 |
60700 |
|
10/30 |
Notes Payable- Kingsville Dr. Interest Expense Dr. Bank A/C Cr. |
55,000 1650 |
56650 |
b. Prepare adjusting entries on December 31 to record accrued interest:
Red Bank Enterprises
Adjusting Entries
For the year ending December 31
|
Date |
Particulars |
Debit ($) |
Credit ($) |
|
10/31 |
Interest Expense Dr. Accrued Interest Expense Cr. |
2217 |
2217 |
2 august to 31st December= 133 days
c. The Current Liability section of Red Bank’s balance sheet as of December 31:
Red Bank Enterprises
Balance Sheet
As of December 31
|
Current Liabilities |
Amounts ($) |
|
Accounts Payable Notes Payable Accrued Interest Expense |
203,600 50,000 2217 |
|
Total Current Liabilities |
255817 |
