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Problem 11-3A (60 minutes)
1. Each employee’s FICA withholdings for Social Security
Dali
Trey
Kiesha
Chee
Total
Maximum base ..............
$118,500
$118,500
$118,500
$118,500
2. Each employee’s FICA withholdings for Medicare (no limits)
Dali
Trey
Kiesha
Chee
Total
3. Employer’s FICA taxes for Social Security
4. Employer’s FICA taxes for Medicare
680
5. Employer’s FUTA taxes
Dali
Trey
Kiesha
Chee
Total
Maximum base .................
$ 7,000
$ 7,000
$ 7,000
$ 7,000
6. Employer’s SUTA taxes
Dali
Trey
Kiesha
Chee
Total
7. Each employee’s net (take-home) pay
Dali
Trey
Kiesha
Chee
Total
Gross earnings ..............
$2,000.00
$ 900.00
$450.00
$400.00
$3,750.00
Less
8. Employer’s total payroll-related expense for each employee
Dali
Trey
Kiesha
Chee
Total
Gross earnings ...............
$2,000.00
$ 900.00
$450.00
$400.00
$3,750.00
Plus
681
Problem 11-4A (40 minutes)
1.
2016
Nov. 11
Cash ..........................................................................
7,875
16
Cash ..........................................................................
16,500
682
Problem 11-4A (Concluded)
2017
Jan. 5
Cash ..........................................................................
11,250
2. Warranty expense for November 2016 and December 2016
Sales
Percent
Warranty Expense
3. Warranty expense for January 2017
4. Balance of the estimated liability as of December 31, 2016
Warranty expense for November ....................................
$ 630
credit
Problem 11-5A (60 minutes)
1. Miller Company
2. Weaver Company
3. Sales increase by 30% (multiply prior sales by 1.3)
Miller Co.
Weaver Co.
Sales .............................................
$1,300,000
$1,300,000
4. Sales increase by 50% (multiply prior sales by 1.5)
Miller Co.
Weaver Co.
Sales .............................................
$1,500,000
$1,500,000
5. Sales increase by 80% (multiply prior sales by 1.8)
Miller Co.
Weaver Co.
Sales .............................................
$1,800,000
$1,800,000
684
Problem 11-5A (Continued)
6. Sales decrease by 10% (multiply prior sales by 0.9)
Miller Co.
Weaver Co.
Sales ........................................
$900,000
$900,000
7. Sales decrease by 20% (multiply prior sales by 0.8)
Miller Co.
Weaver Co.
8. Sales decrease by 40% (multiply prior sales by 0.6)
Miller Co.
Weaver Co.
Sales ........................................
$600,000
$600,000
9. The higher fixed cost strategy (having more fixed interest expense) of
Weaver Co. accentuates the effects of increases and decreases in sales.
That is, increases in sales produce greater increases in net income and
Problem 11-6AA (50 minutes)
Mar. 15
FICA⎯Social Security Taxes Payable ...................
3,472
31
Office Salaries Expense ..........................................
11,200
686
Problem 11-6AA (Concluded)
Apr. 15
FICA⎯Social Security Taxes Payable ...................
3,472
Wild, Shaw, Chiappetta, FAP 23e Solutions Manual: Chapter 11
687
PROBLEM SET B
Problem 11-1B (45 minutes)
Fox-Pro
Spring
Bank
City
Bank
1.
Maturity dates
2.
Interest due at maturity
3.
Accrued interest on City Bank note at the end of 2016
4. Interest in 2017
688
Problem 11-1B (Concluded)
5.
2016
Apr. 22
Merchandise Inventory ...........................................
5,000
Accounts Payable⎯Fox-Pro ............................
5,000
Purchased merchandise on credit.
689
Problem 11-2B (25 minutes)
Part 1
Part 2
690
Problem 11-3B (60 minutes)
1. Each employee’s FICA withholdings for Social Security
Ahmed
Carlos
Jun
Marie
Total
Maximum base ...............
$118,500
$118,500
$118,500
$118,500
2. Each employee’s FICA withholdings for Medicare (no limits)
Ahmed
Carlos
Jun
Marie
Total
3. Employer’s FICA taxes for Social Security
Ahmed
Carlos
Jun
Marie
Total
4. Employer’s FICA taxes for Medicare
Ahmed
Carlos
Jun
Marie
Total
691
Problem 11-3B (Concluded)
5. Employer’s FUTA taxes
Ahmed
Carlos
Jun
Marie
Total
Maximum base ............
$ 7,000
$ 7,000
$ 7,000
$ 7,000
6. Employer’s SUTA taxes
Ahmed
Carlos
Jun
Marie
Total
7. Each employee’s net (take-home pay)
Ahmed
Carlos
Jun
Marie
Total
8. Employer’s total payroll-related expense for each employee
Ahmed
Carlos
Jun
Marie
Total
692
Problem 11-4B (40 minutes)
1.
2016
Nov. 16
Cash ..........................................................................
2,500
Dec. 12
Estimated Warranty Liability ..................................
144
18
Cash ..........................................................................
10,000
Sales ...................................................................
10,000
Sold coffee grinders to customers.
693
Problem 11-4B (Concluded)
2017
Jan. 7
Cash ..........................................................................
2,000
2. Warranty expense for November 2016 and December 2016
Sales
Percent
Warranty Expense
3. Warranty expense for January 2017
4. Balance of the estimated liability as of December 31, 2016
694
Problem 11-5B (60 minutes)
1. Ellis Company
2. Seidel Company
3. Sales increase by 10% (multiply prior sales by 1.10)
Ellis Co.
Seidel Co.
4. Sales increase by 40% (multiply prior sales by 1.40)
Ellis Co.
Seidel Co.
5. Sales increase by 90% (multiply prior sales by 1.90)
Ellis Co.
Seidel Co.
695
Problem 11-5B (Concluded)
6. Sales decrease by 20% (multiply prior sales by 0.80)
Ellis Co.
Seidel Co.
7. Sales decrease by 50% (multiply prior sales by 0.50)
Ellis Co.
Seidel Co.
8. Sales decrease by 80% (multiply prior sales by 0.20)
Ellis Co.
Seidel Co.
9. The higher fixed cost strategy (having more fixed interest expense) of
Ellis Co. accentuates the effects of increases and decreases in sales.
696
Problem 11-6BA (50 minutes)
June 15
FICA—Social Security Taxes Payable ...................
992
30
Payroll Taxes Expense* ...........................................
612
