chapter_9_solution

chapter_9_solution - Chapter 9 Homework Problems E9-2...

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Chapter 9 Homework Problems E9-2 Recording Payroll Costs Warner Company completed the salary and wage payroll for March 2006. The payroll provided the following details: Salaries and wages earned $232,400 Employee income taxes withheld 42,150 Insurance premiums withheld 1,970 FICA taxes* 17,779 *$17,779 each for employer and employees. Required: 1. Give the journal entry to record the payroll for March including employee deductions. 2. Give the journal entry to record the employer's payroll taxes. 3. Give a combined journal entry to show the payment of amounts owed to governmental agencies. 1. March 31 Salary and wage expense 232,400 Liability for income taxes withheld-employees 42,150 Liability for insurance premiums withheld-employees 1,970 FICA taxes payable-employees 17,779 Cash 170,501 2. March 31, 2006: Payroll tax expense 17,779 FICA taxes payable-employer 17,779 3. Liability for income taxes withheld-employees 42,150
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Liability for insurance premiums withheld-employees 1,970 FICA taxes payable-employees 17,779 FICA taxes payable-employer 17,779 Cash 79,678 E9-4 Recording a Note Payable through Its Time to Maturity with Discussion of Management Strategy Many businesses borrow money during periods of increased business activity to finance inventory and accounts receivable. Neiman Marcus is one of America's most prestigious retailers. Each Christmas, Neiman Marcus builds up its inventory to meet the needs of Christmas shoppers. A large portion of Christmas sales are on credit. As a result, Neiman Marcus often collects cash from the sales several months after Christmas. Assume that on November 1, 2006, Neiman Marcus borrowed $4.4 million cash from Texas Capital Bank for working capital purposes and signed an interest- bearing note due in six months. The interest rate was 10 percent per annum payable at maturity. The accounting period ends December 31. Required:
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This note was uploaded on 04/21/2008 for the course AEM 2210 taught by Professor Little,j. during the Fall '07 term at Cornell.

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chapter_9_solution - Chapter 9 Homework Problems E9-2...

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