Quiz A example-1

Quiz A example-1 - If you are unable to complete the first...

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If you are unable to complete the first part of the question, make an assumption and carry on. Note that this may not necessarily mean full points for the remainder of the question. 1) (2 pt) January 2, 2004, Koll, Inc. purchased a patent for a new consumer product for $180,000. At the time of purchase, the patent was valid for 15 years; however, the patent’s useful life was estimated to be only 10 years due to the competitive nature of the product. On December 31, 2007, the product was permanently withdrawn from sale under governmental order because of a potential health hazard in the product. What amount should Koll charge against income during 2007, assuming amortization is recorded at the end of each year? a. $18,000 b. $108,000 c. $126,000 d. $144,000 2. (2 pt) Quirk Corp.'s payroll for the pay period ended October 31, 2007 is summarized as follows: Federal Amount of Wages Subject Department Total Income Tax to Payroll Taxes Payroll Wages Withheld F.I.C.A. Unemployment Factory $ 75,000 $ 9,000 $70,000 $22,000 Sales 22,000 3,000 16,000 2,000 Office 18,000 2,000 8,000 $115,000 $14,000 $94,000 $24,000 Assume the following payroll tax rates: F.I.C.A. for employer and employee 7% each Unemployment 3% What amount should Quirk accrue as its share of payroll taxes in its October 31, 2007 balance sheet? a.
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Quiz A example-1 - If you are unable to complete the first...

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