Chapter 9 - Liabilitiesobligationsthatresultfrompast

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Liabilities  - obligations that result from past  transactions, which will be paid with assets  or services Liquidity  - the ability to pay current liabilities  using current assets
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Accruals Accruals Accrued liabilities  - expenses that have been  incurred before the end of a period but have  not  been paid  Recorded as adjusting entries at year end Accrued vacation is reported as part of accrued  compensation 
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Wages expense 100,000 FICA payable (employees’ portion) 8,000 Liability for Income Taxes Withheld 16,000 Liability for Life Insurance 1,000 Liability for Union Dues 750 Liability for Health Insurance  600 Cash 73,650 To record wages paid to employees for the 2-week period  ending 1/14.
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Payroll tax expense 14,000 FICA payable (employer’s portion) 8,000 State unemployment payable 5,000 Federal unemployment payable 1,000 To record payroll taxes for the 2-week period ending  1/14.
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This note was uploaded on 12/16/2009 for the course AEM 2500 taught by Professor Poe,g. during the Fall '07 term at Cornell University (Engineering School).

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Chapter 9 - Liabilitiesobligationsthatresultfrompast

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