**Problems**1) Record the journal entries for the following current liabilities for Company Z.A) Company Z is required by law to collect and remit sales taxes to the state. If $78,000 of cash sales are subject to a 6% sales tax.B) Company Z faces a probable loss on a pending lawsuit where the amount of the loss is estimated to be $500,000.C) Employees earn vacation pay at the rate of one day per month. During the month, 25 employees qualify for one vacation day each. Their average daily wage is $100 per day.D) Z company estimates that warranty expense will be 4% of sales. The company’s sales for the current period are $185,000.E) Z Company receives $48,000 cash in advance ticket sales for 12 home games. Record the advance ticket sales on April 30. Record the revenue earned for the first home game played on August 14.| A. | ||---|---|| | || B. | ||---|---|| | || C. | ||---|---|| | || D. | ||---|---|| | || E. | ||---|---|| | |

Journal Entry - It is record of every business transactions in day to day life whether it is…

Answered: Problems 1). Record the journal entries…

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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Wall Company sold a product under a two year warranty. The estimated cost of warranty repairs is 2% of net sales. During the 1st two years in business, the entity made the following sales and incurred the following warranty repair costs: 2020 2019 2,500,000 3,000,000 Net Sales Total Repair Costs Incurred 45,000 50,000 What amount should be reported as warranty expense for 2020? O 60,000 50,000 10,000 59,000
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Joel received a 1099-C; $6000 in box 2 had been cancelled by credit card co. as result of agreement. Original card debt was $14,000. Is $8,000 excluded from income? For what reason (Form 982) ? He is not insolvent, ;but was unemployed for part of the year and received unemployment.
Monty Corp. sells idle machinery to Sandhill Company on July 1, 2020, for $63,000. Monty agrees to repurchase this equipment from Sandhill on June 30, 2021, for a price of $66,780 (an imputed interest rate of 6%). Prepare the journal entry for Monty for the receipt of cash from Sandhill on July 1, 2020. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Date Account Titles and Explanation Debit Credit July 1, 2020 SHOW LIST OF ACCOUNTS LINK TO TEXT Prepare any other necessary journal entry for Monty in 2020. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, selecet "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit Credit December 31, 2020 Prepare the journal entries for Monty when the machinery is repurchased…
Bramble Corp. has the following account balances at December 31, 2021: Notes payable ($47,000 due after 12/31/22) $78,000 Unearned service revenue 55,000 Mortgage Payable ($70,000 due in 2022) 195,000 Salaries payable 25,000 Accounts payable 49,000 In addition, Bramble is involved in a lawsuit. Legal counsel feels it is probable Bramble will pay damages of $20,000 in 2022. Bramble records provisions related to litigations in the account Litigation Liability. Prepare the current liabilities section of Bramble's December 31, 2021, balance sheet. Bramble Corp. (Partial) Balance Sheet
am. 09.
Assume the following scenarios.Scenario 1: During 2021, The Hubbard Group provides services of $900,000 for repair of a state highway. The company receives an initial payment of $300,000 with the balance to be received the following year.Scenario 2: Rolling Stone magazine typically charges $80 for a one-year subscription. On January 1, 2021, Herman, age 72, purchases a one-year subscription to the magazine and receives a 15% senior citizen discount.Scenario 3: During 2021, Waste Management provides services on account for $30,000. The customer pays for those services in 2022.Scenario 4: During 2021, Sysco Corporation sells grocery items to one of its customers for $260,000 on account. Cash collections on those sales are $180,000 in 2021 and $60,000 in 2022. The remaining $20,000 is written off as uncollectible in 2022.Required: For each scenario, calculate the amount of revenue to be recognized in 2021.
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Clyde is a cash-method taxpayer who reports on a calendar-year basis. This year Paylate Corporation has decided to pay Clyde a year-end bonus of $1,450.Determine the amount Clyde should include in his gross income this year under the following circumstances. (Leave no answer blank. Enter zero if applicable.) Problem 5-53 Part-d (Algo) d. Clyde picked up the check in December, but the check could not be cashed immediately because it was postdated January 10. Amount to be included in gross income - ________
6. During 2019, Reed Corporation sold merchandise for a total of $900,000. The cost of merchandise to Reed was $675,000. Reed offers credit terms of 1/10, n/30 to encourage early payment. At year-end, there are $22,500 of sales still eligible for the 1% discount. Reed believes that all of the companies will pay within the discount period to receive the 1% discount. Assume Reed's fiscal year is December 31. Reed's adjusting journal entry will include: A) A debit to Sales Discounts for $225 B) A credit to Allowance for Sales Discounts for $2,250 C) A debit to Sales Discounts for $2,050 D) A credit to Sales Discounts for $225 E) No adjusting journal entry is required. Discount will be recognized when payment is received.
Mr. Martin commences business on January 1, 2018. His debtors at December 31, 2019, were $15 000 December 31, 2020, were $12 000 December 31, 2021, were $14 000 A provision for bad debts of 5 per cent is to be created on debts at the end of each year. Use the information above to answer the following questions. i. Show the Provisions for Bad Debts Account for EACH of the three years. ii. Show the Profit and Loss extract for the three years. iii. Show the Balance Sheet extract for the three years.

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