Assign_7_-_Solutions_to_Practice_Problem

Note to instructors the damage awards and fines would

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Note to Instructors: The “damage awards and fines” would be disclosed on the income statement under “Other expenses.” b. The company experienced a hazardous materials spill at one of its plants during the previous period. This spill has resulted in a number of lawsuits to which the company is a party. The Environmental Protection Agency (EPA) has fined the company $570,000, which the company is contesting in court. Although the company does not admit fault, legal counsel believes that the fine payment is probable. In addition, an employee has sued the company. A $238,000 out-of-court settlement has been reached with the employee. The EPA fine and out-of-court settlement have been recognized as an expense for the period. There is one other outstanding lawsuit related to this incident. Counsel does not believe that the lawsuit has merit. Other lawsuits and unknown liabilities may arise from this incident.
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Prob. 10–5A 1. PAYROLL FOR WEEK ENDING December 7, 2012 EARNING S DEDUCTI ONS PAID ACCOUNTS DEBITED Name Total Hours Regular Overtime Total Social Security Tax Medicare Tax Federal Income Tax U.S. Savings Bonds Total Net Pay Ck. No. Sales Salaries Expense Office Salaries Expense Blanda 48 1,760.0 0 528.00 2,288. 00 137.28 34.32 526.24 45.00 742.84 1,545.16 625 2,288.00 Dawson 42 1,520.00 114.00 1,634.00 98.04 24.51 351.31 50.00 523.86 1,110.14 626 1,634.00 Fouts 44 1,840.00 276.00 2,116.00 126.96 31.74 402.04 55.00 615.74 1,500.26 627 2,116.00 Griese 36 1,152.00 1,152.00 69.12 17.28 241.92 65.00 393.32 758.68 628 1,152.00 Namath 45 1,600.00 300.00 1,900.00 114.00 28.50 399.00 541.50 1,358.50 629 1,900.00 Marino 2,200.00 132.00 33.00 528.00 44.00 737.00
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