Finanical Acct - Chapter 13

Topics: Balance sheet, Generally Accepted Accounting Principles, Asset Pages: 2 (278 words) Published: December 13, 2012
Jenny Sawh
Chapter 13
13-8, 13-11, 13-19
December 10, 2012

DRCR
Salaries and Wages Expense $480, 000
Withholding Taxes Payable$80,000
FICA Taxes Payable$28,040
Union Dues Payable$9,000
Cash [($480,000 – $140,000) X 7.65% = $26,010]$362,960

Payroll Tax Expense $29,440
FICA Taxes Payable
$140,000 X 1.45% = $2,030; $26,010 + $2,030 = $28,040$28,040 FUTA Taxes Payable
[($480,000 – $410,000) X .8%)$560
SUTA Taxes Payable
[$70,000 X (3.5% – 2.3%)]$840

a. DRCR
Cash $3,000,000
Sales Revenue (500 X $6,000)$3,000,000
Warranty Expense$30,000
Inventory $30,000
Warranty Expense$90,000
Warranty Liability ($120,000 - $30,000)$90,000

b.
Cash$3,000,000
Sales Revenue$2,840,000
Unearned Warranty Revenue $160,000
Warranty Expense $30,000
Inventory $30,000
Unearned Warranty Revenue $40,000
Warranty Expense ($160,000X($30,000/$120,000))$40,000

a.
1. $318,000 / $87,000 = 3.66 times
2. $820,000 / ($200,000 + $170,000)/2 = 4.43 times (82 days) 3. $1,400,000 / $95,000 = 14.74 times (25 Days)
4. $210,000 /52,000 = $4.04
5. $210,000 /$1,400,000 = 15.0%
6. $210,000 / $488,000 = 43.03%
b.
1. No effect on current ratio, if already included in the allowance for doubtful accounts. 2. Weaken current ratio by reducing current assets.
3. Improve current ratio by reducing current assets and current liabilities by a like amount. 4. No effect on current ratio.
5. Weaken current ratio by increasing current liabilities.
6. No effect on current ratio
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