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a. During the year 20X1, Aeryn Company had net credit sales of $970,000. Past experience shows that 0.5 percent of the firm's net credit sales result in uncollectible accounts. b. Equipment purchased by Moloney Consultancy for $27,140 on January 2, 20X1, has an estimated useful life of 8 years and an estimated salvage value of $2,100. What adjustment for depreciation should be recorded on the firm's worksheet for the year ended December 31, 20X1? c. On December 31, 20X1, Fasano Music Studio owed wages of $6,300 to its employees, who are paid weekly. d. On December 31, 20X1, Fasano Music Studio owed the employer's social security (6.2 percent) and Medicare (1.45 percent) taxes on the entire $6,300 of accrued wages for its employees. e. On December 31, 20X1, Fasano Music Studio owed federal (0.6 percent) and state (5.4 percent) unemployment taxes on the entire $6,300 of accrued wages for its employees. or each of the above independent situations, prepare the adjusting entries that must be made on the December 31, 0x1 worksheet

a. During the year 20X1, Aeryn Company had net credit sales of $970,000. Past experience shows that 0.5 percent of the firm's net credit sales result in uncollectible accounts. b. Equipment purchased by Moloney Consultancy for $27,140 on January 2, 20X1, has an estimated useful life of 8 years and an estimated salvage value of $2,100. What adjustment for depreciation should be recorded on the firm's worksheet for the year ended December 31, 20X1? c. On December 31, 20X1, Fasano Music Studio owed wages of $6,300 to its employees, who are paid weekly. d. On December 31, 20X1, Fasano Music Studio owed the employer's social security (6.2 percent) and Medicare (1.45 percent) taxes on the entire $6,300 of accrued wages for its employees. e. On December 31, 20X1, Fasano Music Studio owed federal (0.6 percent) and state (5.4 percent) unemployment taxes on the entire $6,300 of accrued wages for its employees. or each of the above independent situations, prepare the adjusting entries that must be made on the December 31, 0x1 worksheet

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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For each of the above independent situations, prepare the adjusting entries that must be made on the December 31, 20X1, worksheet.

Exercise 12.3 (Algo) Preparing adjustments for uncollectible accounts, depreciation, and payroll items. LO 12-2 a. During the year 20X1, Aeryn Company had net credit sales of $970,000. Past experience shows that 0.5 percent of the firm's net credit sales result in uncollectible accounts. b. Equipment purchased by Moloney Consultancy for $27,140 on January 2, 20X1, has an estimated useful life of 8 years and an estimated salvage value of $2,100. What adjustment for depreciation should be recorded on the firm's worksheet for the year ended December 31, 20X1? c. On December 31, 20X1, Fasano Music Studio owed wages of $6,300 to its employees, who are paid weekly. d. On December 31, 20X1, Fasano Music Studio owed the employer's social security (6.2 percent) and Medicare (1.45 percent) taxes on the entire $6,300 of accrued wages for its employees. e. On December 31, 20X1, Fasano Music Studio owed federal (0.6 percent) and state (5.4 percent) unemployment taxes on the entire $6,300 of accrued wages for its employees. For each of the above independent situations, prepare the adjusting entries that must be made on the December 31, 20X1, worksheet. Note: Round your answers to 2 decimal places. View transaction list
Transcribed Image Text:Exercise 12.3 (Algo) Preparing adjustments for uncollectible accounts, depreciation, and payroll items. LO 12-2 a. During the year 20X1, Aeryn Company had net credit sales of $970,000. Past experience shows that 0.5 percent of the firm's net credit sales result in uncollectible accounts. b. Equipment purchased by Moloney Consultancy for $27,140 on January 2, 20X1, has an estimated useful life of 8 years and an estimated salvage value of $2,100. What adjustment for depreciation should be recorded on the firm's worksheet for the year ended December 31, 20X1? c. On December 31, 20X1, Fasano Music Studio owed wages of $6,300 to its employees, who are paid weekly. d. On December 31, 20X1, Fasano Music Studio owed the employer's social security (6.2 percent) and Medicare (1.45 percent) taxes on the entire $6,300 of accrued wages for its employees. e. On December 31, 20X1, Fasano Music Studio owed federal (0.6 percent) and state (5.4 percent) unemployment taxes on the entire $6,300 of accrued wages for its employees. For each of the above independent situations, prepare the adjusting entries that must be made on the December 31, 20X1, worksheet. Note: Round your answers to 2 decimal places. View transaction list
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