Prepare journal entries to record the transactions
1. Payroll accounting. Assume that the next tax charges and payroll data pertain to Brookhaven Publishing: • Social Safety taxes: four% on the primary $55,000 earned per worker • Medicare taxes: 1.5% on the primary $130,000 earned per worker • Federal earnings taxes withheld from wages: $7,500 • State earnings taxes: four% of gross earnings • Insurance coverage withholdings: 1% of gross earnings • State unemployment taxes: 5.four% on the primary $7,000 earned per worker • Federal unemployment taxes: zero.eight% on the primary $7,000 earned per worker The corporate incurred a wage expense of $50,000 throughout February. All staff had earned lower than $5,000 by month-end and no wages have been paid through the month. a. Put together the mandatory entry to document Brookhaven’s February payroll. The entry will embody deductions for the next: • Social Safety taxes • Medicare taxes • Federal earnings taxes withheld • State earnings taxes • Insurance coverage with holdings b. Put together the journal entry to document Brookhaven’s payroll tax expense. The entry will embody the next: • Matching Social Safety taxes • Matching Medicare taxes • State unemployment taxes • Federal unemployment taxes 2. Present liabilities: entries and disclosure. A evaluation of chosen monetary actions of Visconti’s throughout 20XX disclosed the next: 1-Dec: Borrowed $10,000 from the First Metropolis Financial institution by signing a Three-month, 15% be aware payable. Curiosity and principal are due at maturity. 10-Dec: Established a guaranty legal responsibility for the XY-80, a brand new product. Gross sales are anticipated to complete 1,000 models through the month. Previous expertise with related merchandise signifies that Three% of the models would require restore, with guarantee prices averaging $27 per unit (elements solely). 22-Dec: Bought $16,000 of merchandise on account from Oregon Firm, phrases 2/10, n/30. 26-Dec: Borrowed $5,000 from First Metropolis Financial institution; signed a 15% be aware payable due in 60 days. (Assume 360 day 12 months for curiosity) 31-Dec: Repaired six XY-80s through the month at a complete value of $162 31-Dec: Accrued three days of salaries at a complete value of $1,400. Directions a. Put together journal entries to document the transactions. b. Put together adjusting entries on December 31 to document accrued curiosity. c. Put together the Present Legal responsibility part of Crimson Financial institution’s stability sheet as of December 31. Assume that the Accounts Payable account totals $203,600 on this date. Three. Notes payable. Crimson Financial institution Enterprises was concerned within the following transactions through the fiscal 12 months ending October 31: 2-Aug: Borrowed $55,000 from the Financial institution of Kingsville by signing a 90-day, 12% be aware. 20-Aug: Issued a $50,000 be aware to Harris Motors for the acquisition of a $50,000 supply truck. The be aware is due in 180 days and carries a 12% curiosity r ate. 10-Sep: Bought merchandise from Pans Enterprises within the quantity of $15,000. Issued a 30-day, 12% be aware in settlement of the stability owed. 11-Sep: Issued a $60,000 be aware to Datatex Tools in settlement of an overdue account payable of the identical quantity. The be aware is due in 30 days and carries a 14% rate of interest. 10-Oct: The be aware to Pans Enterprises was paid in full. 11-Oct: The be aware to Datatex Tools was paid in full. 30-Oct: Paid be aware to Financial institution of Kingsville. Directions a. Put together journal entries to document the transactions. b. Put together adjusting entries on December 31 to document accrued curiosity. (Each day curiosity is calculated using the 360 day methodology). c. Put together the Present Legal responsibility part of Crimson Financial institution’s stability sheet as of December 31. Assume that the Accounts Payable account totals $203,600 on this date.