Question 5: 7% points: Flip earns a salary of $7,500 per month during the year. FICA taxes are 8% on the first $100,000 of gross earnings. Federal unemployment insurance taxes are 6.2% of the first $7,000; however, a credit is allowed equal to the state u

profileUOPOnlineTutor
 (Not rated)
 (Not rated)
Chat

Question 5: 7% points:

Flip earns a salary of $7,500 per month during the year. FICA taxes are 8% on the first $100,000 of gross earnings. Federal unemployment insurance taxes are 6.2% of the first $7,000; however, a credit is allowed equal to the state unemployment insurance taxes of 5.4% on the $7,000. During the year, $25,600 was withheld for federal income taxes and $5,700 was withheld for state income taxes.

 

Instructions

(a)    Prepare a journal entry summarizing the payment of Flip’s total salary during the year.

(b)    Prepare a journal entry summarizing the employer payroll tax expense on Flip’s salary for the year.

(c)    Determine the cost of employing Flip for the year.

 

Question 6: 4% points:

Flip Company at the end of the fiscal 2014 year has the following information: Credit Sales, $2,500,000 Sales Returns & Allowances $25,000 Accounts Receivable $200,000 and Allowance for Doubtful Accounts with a debit o $1,500.

 

Required:

            a. Prepare the general journal entry to record the end of the year adjusting entry if Flip uses 0.5% of Net Credit Sales as the basis for determining Bad Debt Expense.

            b. Prepare the general journal entry to record the end of the year adjusting entry if Flip uses 5% of Accounts Receivable as the basis for determining Bad Debt Expense.

Acct 220.Sp.15                                                                                     

 

Question 1: Suggested time 45 minutes: 40% points

    • 7 years ago
    A+ Solution
    NOT RATED

    Purchase the answer to view it

    blurred-text
    • attachment
      helped.docx