Problem-07: Current Liabilities and Payroll Accounting

On June 1, Merando Company borrows $90,000 from First Bank on a 6-month, $90,000, 8% note

Instructions

Prepare the entry on June 1
Prepare the adjusting entry on June 30.
Prepare the entry at maturity (December 1), assuming monthly adjusting entries have been made through November 30.
What was the total financing cost (interest expense)?

Solution

Merando Company

Problems: Current Liabilities and Payroll Accounting

Problem-04: Current Liabilities and Payroll Accounting

The following payroll liability accounts are included in the ledger of Harmon Company on January 1, 2019 FICA Taxes Payable$760.00 Federal Income Taxes Payable1,204.60 State income Taxes Payable108.95 Federal Unemployment...

Problem-05: Current Liabilities and Payroll Accounting

For the year ended December 31, 2019, Denkinger Electrical Repair Company reports the following summary payroll data. Denkinger Company's payroll taxes are Social Security tax 6.2%, Medicare tax 1.45%, state...

Problem-06: Current Liabilities and Payroll Accounting

C.S. Lewis Company had the following transactions involving notes payable. July 1, 2020Borrows $50,000 from First National Bank by signing a 9-month, 8% note. Nov. 1, 2020Borrows $60,000 from Lyon...

Problem-07: Current Liabilities and Payroll Accounting

On June 1, Merando Company borrows $90,000 from First Bank on a 6-month, $90,000, 8% note Instructions Prepare the entry on June 1 Prepare the adjusting entry on June 30....

Problem-08: Current Liabilities and Payroll Accounting

In performing accounting services for small businesses, you encounter the following situations pertaining to cash sales. Poole Company enters sales and sales taxes separately on its cash register. On April...

Problem-09: Current Liabilities and Payroll Accounting

Moreno Company publishes a monthly sports magazine, Fishing Preview, Subscriptions to the magazine cost $20 per year. During November 2019, Moreno sells 15,000 subscriptions beginning with the December issue, Moreno...

Problem-10: Current Liabilities and Payroll Accounting

Betancourt Company sells automatic can openers under a 75-day warranty for defective merchandise, Based on past experience, Betancourt estimates that 3% of the units sold will become defective during the...

Problem-11: Current Liabilities and Payroll Accounting

Gallardo Co. is involved in a lawsuit as a result of an accident that took place September 5, 2020. The lawsuit was filed on November 1, 2020, and claims damages...

Problem-12: Current Liabilities and Payroll Accounting

Younger Online Company has the following liability accounts after posting adjusting entries: Accounts Payable $73,000, Unearned Ticket Revenue $24,000, Warranty Liability $18,000, Interest Payable $8,000, Mortgage Payable $120,000, Notes Payable...

Problem-13: Current Liabilities and Payroll Accounting

Suppose the following financial data were reported by $3M Company for 2019 and 2020 3M CompanyBalance Sheets (partial) Instructions Calculate the current ratio and working capital for 3M for 2019...

Problem-14: Current Liabilities and Payroll Accounting

Maria Garza's regular hourly wage rate is $16, and she receives a wage of 1 1/2 times the regular hourly rate for work in excess of 40 hours. During a...

Problem-15: Current Liabilities and Payroll Accounting

Employee earnings records for Slaymaker Company reveals the following gross earnings for four employees through the pay period of December 15. J. Seligman$93,500L. Marshall$115,100 R. Eby$113,600T. Olson$120,000 For the pay...

Problem-16: Current Liabilities and Payroll Accounting

Ramirez Company has the following data for the weekly payroll ending January 31. Employees are paid 1 1/2 times the regular hourly rate for all hours worked in excess of...

Problem-17: Current Liabilities and Payroll Accounting

Selected data from a February payroll register for Sutton Company are presented below. Some amounts are intentionally omitted. FICA taxes are 7.65%, State income taxes are 4% of gross earnings....

Problem-18: Current Liabilities and Payroll Accounting

According to a payroll register summary of Frederickson Company, the amount of employees, gross pay in December was $850,000, of which $80,000 was not subject to Social Security taxes of...

Problem-19: Current Liabilities and Payroll Accounting

Mayberry Company has two fringe benefit plans for its employees. It grants employees 2 days' vacation for each month worked. Ten employees worked the entire month of March at an...

Problem-20: Current Liabilities and Payroll Accounting

Podsednik Corporation has 20 employees who each earn $140 a day. The following information is available. At December 31, Podsednik recorded vacation benefits. Each employee earned 5 vacation days during...

Problem-03: Current Liabilities and Payroll Accounting

Mann Hardware has four employees who are paid on an hourly basis plus time-and-a-half for all hours worked in excess of 40 a week. Payrolll data for the week ended...

Problem-02: Current Liabilities and Payroll Accounting

The following are selected transactions of Blanco Company. Blanco prepares financial statements quarterly. Jan. 2Purchased merchandise on account from Nunez Company, $30,000, terms 2/10, n/30. (Blanco uses the perpetual inventory...

Problem-01: Current Liabilities and Payroll Accounting

On January 1, 2020, the ledger of Accardo Company contains the following liability accounts. Accounts Payable$52,000 Sales Taxes Payable7,700 Unearned Service Revenue16,000 During January, the following selected transactions occurred. Jan....

Current Liabilities and Payroll Accounting