Chapter 09 – Reporting and Interpreting Liabilities
Solutions Chapter 9 – Set B Exercises – Libby 8e
E9–1B.
Req. 1
(a)
Current assets ($630,000 – $392,000) …………………….
$238,000
Current liabilities:
Accounts payable ……………………………………………….
$76,000
Income taxes payable …………………………………………
10,000
Liability for withholding taxes ………………………………..
5,000
Rent revenue collected in advance ……………………….
8,000
Wages payable …………………………………………………..
9,000
Property taxes payable ………………………………………..
4,000
Note payable, 10% (due in 6 months) ……………………
11,500
Interest payable (due in 2 months) ………………………..
800
(124,300
)
Working capital ……………………………………………………..
$ 113,700
E9–2B.
Req. 1
May 31
Salary and wage expense (+E, –SE) ………………………………..
211,000
Liability for income taxes withheld-employees (+L) …………
43,000
Liability for insurance premiums withheld-employees (+L) .
2,000
FICA taxes payable-employees (+L) …………………………….
15,000
Cash (-A) ………………………………………………………………….
151,000
Payroll for May including employee deductions.
Payroll tax expense (+E, –SE) …………………………………………
15,000
FICA taxes payable-employer (+L) ……………………………….
15,000
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E9–5B.
Req. 1
$60,000 x 0.7513
=
$45,078
Req. 2
$12,000 x 2.4869
=
$29,843
$30,000 x 0.5132
=
$15,396
$20,000 x 6.1446
=
$122,892
E9–6B.
E9–7B.
E9–8B.
Req. 1
December 31
Savings account (+A) ……………………………………………..
4,000
Cash (-A) …………………………………………………………..
4,000
Req. 2
$4,000 x 15.1929 = $60,772 (balance)
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E9–9B.
Req. 1
Date Assets Liabilities Stockholders’ Equity
Feb 1 Inventory + Accounts Payable + Not Affected
May 1 Cash + Note Payable + Not Affected
Req. 2
October 31 Cash Paid: $37,800 (Principal plus interest)
