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Recording Various Liabilities
Glenview Hardware had the following transactions that produced liabilities during 2020:
a. Purchased merchandise on credit for $30,000. ( Note: Assume a periodic inventory system.)
b. Year-end wages of $10,000 were incurred, but not paid. Related federal income taxes of $1,200, Social Security of $620 (employee portion), and Medicare taxes of $145 were with-held from employees.
c. Year-end estimated income taxes payable, but unpaid, for the year were $42,850.
d. Sold merchandise on account for $1,262, including state sales taxes of S48. ( Note: Assume a periodic inventory system.)
e. Employer’s share of Social Security and Medicare taxes for the period were $620 and $145, respectively.
f. Borrowed cash under a 90-day, 9%, $25,000 note.
Required:
Prepare the entry to record each of these transactions (treat each transaction independently).
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Cornerstones of Financial Accounting
- Recording Various Liabilities Plymouth Electronics had the following transactions that produced liabilities during 2020: a. Purchased merchandise on credit for $80,000. ( Note: Assume a periodic inventory system.) Year-end wages of $40,000 were incurred, but not paid. Related federal income taxes of $13,000 and Medicare taxes of $580 were withheld. Employee wages are all above the Social Security maximum, so only Medicare was paid. b. Year-end estimated income taxes payable, but unpaid, for the year were $113,615. c. Sold merchandise on account for $3,636, including state sales taxes of $180. ( Note: Assume a periodic inventory system.) d. Employers share of Medicare taxes for the period was $580. The taxes will be paid at a later date. e. Borrowed cash under a 180-day, 8%, $155,000 note. Required: Prepare the entry to record each of these transactions (treat each transaction independently).arrow_forwardInferring Accounts Receivable Amounts At the end of 2019, Karras Inc. had a debit balance of 141,120 in its accounts receivable. Additionally, Karras had a credit balance in its allowance for doubtful accounts of 4,350 and 9,420 at the beginning and end of the year, respectively. During the year, Karras made credit sales of 1,530,000, collected receivables in the amount of 1,445,700, and recorded bad debt expense of 83, 750. Required: Next Level Compute the amount of accounts receivable that Karras wrote off during the year and the amount of accounts receivable at the beginning of the year.arrow_forwardWhat is the amortized cost of accounts receivable at December 31, 2021?arrow_forward
- Zing Cell Phone Company entered into the following transactions involving current liabilities during 2020 and 2021. 2020 Mar. 14 Purchased merchandise on credit from Ferris Inc. for $136,000. The termswere 1/10, n/30 (assume a perpetual inventory system). Apr. 14 Zing paid $23,000 cash and replaced the $113,000 remaining balance of the accountpayable to Ferris Inc. with a 3%, 60-day note payable. May 21 Borrowed $123,000 from Scotiabank by signing a 2.5%, 90-day note. ? Paid the note to Ferris Inc. at maturity. ? Paid the note to Scotiabank at maturity. Dec. 15 Borrowed $98,000 and signed a 3.25%, 120-day note with National Bank. Dec. 31 Recorded an adjusting entry for the accrual of interest on the note to National Bank. 2021 ? Paid the note to National Bank at maturity. Required:1. Determine the maturity dates of the three notes just described.2. Present journal entries for each of the preceding dates. (Use 365 days an year. Do not round…arrow_forwardZing Cell Phone Company entered into the following transactions involving current liabilities during 2020 and 2021. 2020 Mar. 14 Purchased merchandise on credit from Ferris Inc. for $152,000. The termswere 1/10, n/30 (assume a perpetual inventory system). Apr. 14 Zing paid $31,000 cash and replaced the $121,000 remaining balance of the accountpayable to Ferris Inc. with a 4%, 60-day note payable. May 21 Borrowed $131,000 from Scotiabank by signing a 3.5%, 90-day note. ? Paid the note to Ferris Inc. at maturity. ? Paid the note to Scotiabank at maturity. Dec. 15 Borrowed $106,000 and signed a 4.25%, 120-day note with National Bank. Dec. 31 Recorded an adjusting entry for the accrual of interest on the note to National Bank. 2021 ? Paid the note to National Bank at maturity. Required:1. Determine the maturity dates of the three notes just described. HINT: Maturity Date of Ferris Inc, Scotiabank, National bank respectively. Present journal entries…arrow_forwardZing Cell Phone Company entered into the following transactions involving current liabilities during 2020 and 2021. 2020 Mar. 14 Purchased merchandise on credit from Ferris Inc. for $160,000. The termswere 1/10, n/30 (assume a perpetual inventory system). Apr. 14 Zing paid $35,000 cash and replaced the $125,000 remaining balance of the accountpayable to Ferris Inc. with a 6%, 60-day note payable. May 21 Borrowed $135,000 from Scotiabank by signing a 5.5%, 90-day note. ? Paid the note to Ferris Inc. at maturity. ? Paid the note to Scotiabank at maturity. Dec. 15 Borrowed $110,000 and signed a 6.25%, 120-day note with National Bank. Dec. 31 Recorded an adjusting entry for the accrual of interest on the note to National Bank. 2021 ? Paid the note to National Bank at maturity. Required:1. Determine the maturity dates of the three notes just described. 2. Present journal entries for each of the preceding dates. (Use 365 days an year. Do not round…arrow_forward
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