Week 2 Assignment
In your textbook Accounting 28th edition:
Do the following exercises from Chapter 11, page 567 in Excel spreadsheet:
– Exercise 11-1 Current liabilities
Bon Nebo Co. sold 25,000 annual subscriptions of Magazine 20XX for $85 during December 20Y8. These new subscribers will receive monthly issues, beginning in January 20Y9. In addition, the business had taxable income of $840,000 during the first calendar quarter of 20Y9. The federal tax rate is 40%. A quarterly tax payment will be made on April 12, 20Y9.
Prepare the Current liabilities section of the balance sheet for Bon Nebo Co. on March 31, 20Y9.
– Exercise 11-2 Entries for notes payable
Cosimo Enterprises issues a $260,000, 45-day, 5% note to Dixon Industries for merchandise inventory.
Journalize Cosimo Enterprises’ entries to record:
the issuance of the note.
the payment of the note at maturity.
Journalize Dixon Industries’ entries to record:
the receipt of the note.
the receipt of the payment of the note at maturity.
– Exercise 11-3 Entries for discounting notes payable
Ramsey Company issues an $800,000, 45-day note to Buckner Company for merchandise inventory. Buckner discounts the note at 7%.
Journalize Ramsey’s entries to record:
the issuance of the note.
the payment of the note at maturity.
Journalize Buckner’s entries to record:
the receipt of the note.
the receipt of the payment of the note at maturity.
-Analyze and answer Chapter 11 Discussion Questions 1-4
1. Does a discounted note payable provide credit without interest? Discuss.
2. Employees are subject to taxes withheld from their paychecks.
List the federal taxes withheld from most employee paychecks.
Give the title of the accounts credited by amounts withheld.
3. Why are deductions from employees’ earnings classified as liabilities for the employer?
4. For each of the following payroll-related taxes, indicate whether they generally apply to (a) employees only, (b) employers only, or (c) both employees and employers:
Federal income tax
Medicare tax
Social security tax
Federal unemployment compensation tax
State unemployment compensation tax
Assignment must have at least 150 words and be written in APA style. Assignment must have at least 3 external references with corresponding in-text citations.
