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52.
The two basic characteristics of estimated liabilities are:
53.
If a business ceases operations and liquidates, which of the following will be paid
last
?
54.
A measure of a company's liquidity is:
55.
On October 1, 2015, Master's Co. borrows $500,000 from its bank for five years at an
annual interest rate of 10%. According to the terms of the loan, the principal amount will
not be due for five years. Interest is to be paid monthly on the first day of each month,
beginning November 1, 2015. With respect to this borrowing, Master's December 31, 2015,
balance sheet included only a long-term note payable of $500,000. As a result:
56.
Interest payable on a loan becomes a liability:
57.
On November 1, Metro Corporation borrowed $55,000 from a bank and signed a 12%, 90-
day note payable in the amount of $55,000. The November 30 adjusting entry will be:
(assume 360 days in year)
On November 1, Year 1, Noble Co. borrowed $80,000 from South Bank and signed a 12%,
six-month note payable, all due at maturity. The interest on this loan is stated separately.
58.
Refer to the information above. How much must Noble pay South Bank on May 1, Year 2,
when the note matures?
59.
Refer to the information above. How much interest expense will Noble recognize on this
note in Year 2?
60.
Refer to the information above. At December 31, Year 1, Noble Co.'s overall liability for this
loan amounts to:
10-26
61.
Refer to the information above. At December 31, Year 1, the adjusting entry with respect
to this note includes a:
On September 1, 2015, Able Company purchased a building from Regal Corporation by
paying $200,000 cash and issuing a one-year note payable for the balance of the purchase
price. Interest on the note is stated at an annual rate of 9% and is paid at maturity. In its
December 31, 2015, balance sheet, Able correctly presented the note and interest payable
as follows:
62.
Refer to the information above. How much must Able pay Regal Corporation on September
1, 2016, when the note matures?
63.
Refer to the information above. What is the amount of the interest expense Able will
recognize on this note in 2016?
64.
Refer to the information above. What is the total cash (including interest) paid for the
building purchased by Able?
65.
Refer to the information above. The adjusting entry at December 31, 2015, with respect to
this note included:
On September 1, 2015, Select Company borrowed $600,000 from a bank and signed a 12%,
six-month note payable, with interest on the note due at maturity.
66.
Refer to the information above. The total amount of the current liability (including interest
payable) for this loan that appears in Select Company's balance sheet at December 31,
2015, is:
67.
Refer to the information above. Assume Select made no adjusting entry with respect to
this note before preparing the financial statements at December 31, 2015. What is the
effect of this error on the financial statements for 2015?
68.
Sanford Corporation borrowed $90,000 by issuing a 12%, six-month note payable, all due
at the maturity date. After one month, the company's total liability for this loan amounts
to:
69.
On November 1 of the current year, Garcia Company borrowed $50,000 by issuing a 9%,
six-month note payable, all due at maturity date. Interest expense on this note to be
recognized during the current year amounts to:
70.
The current portion of long-term debt should be reported:
71.
Employers are required to pay all of the following on the wages paid to each employee
except
:
72.
The Social Security tax paid by an employer is:
73.
Which of the following payroll costs are shared equally by the employer and the
employee?
74.
An employer's total payroll-related costs always exceed the wages and salaries earned by
employees by:
10-34
75.
The amounts that a business withholds as taxes from an employee's earnings:
The average employee of Girard Corporation earns gross pay of $75,000 per year. The
following table shows the relative size of various payroll amounts by expressing each as a
percentage of total wages and salaries expense (gross pay):
In addition, Girard pays $425 per month per employee for group health insurance.
76.
Refer to the information above. Which of the following is the largest payroll-related
expense incurred by Girard?
77.
Refer to the information above. Which of the following represents the second largest
payroll related expense incurred by Girard?
78.
Refer to the information above. Which of the following represents the largest amount
withheld from employees' paychecks?
79.
Which of the following payroll taxes do
not
stop once an employee reaches a certain level
of income:
Stone Corporation has 25 employees and incurs total wages and salaries expense of
$900,000 per year. The following table shows various payroll amounts as a percentage of
this annual wage and salaries expense:
In addition, Stone provides group health insurance for its entire workforce. The cost of this
insurance is $350 per month for each employee.
80.
Refer to the information above. The company's annual payroll-related expenses amount to
approximately:
81.
Refer to the information above. Employees' annual "take-home-pay," totals
approximately:
82.
Refer to the information above. Some of the payroll-related expenses incurred by Stone
Corporation are mandated by law, rather than negotiated with employees. During the
current year, these mandated amounts increased Stone's payroll-related expenses by
approximately:
83.
Refer to the information above. Assume that the federal government implements a 10%
payroll tax upon employers to finance health insurance for all citizens and residents. Stone
will pay this tax instead of purchasing group health insurance. This will cause Stone's total
annual payroll-related expenses to:
Rockland Corporation has 22 employees and incurs total wages and salaries expense of
$800,000 per year. The following table shows various payroll amounts as a percentage of
this annual wage and salaries expense:
In addition, Rockland provides group health insurance for its entire workforce. The cost of
this insurance is $450 per month for each employee.
84.
Refer to the information above. The company's annual payroll-related expenses amount to
approximately:
