· Net pay = Gross pay – __________ · __________ = Current assets – Current liabilities · __________ = Current assets / Current liabilities · __________ = Quick assets / Current liabilities Exercises...

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Answered Same DayNov 07, 2021

Answer To: · Net pay = Gross pay – __________ · __________ = Current assets – Current liabilities · __________...

Harshit answered on Nov 14 2021
144 Votes
Question 1
This is an Accounts Payable liability. Any purchase of inventory on credit will be under the head “Accounts Payable". This will come under the head of current liability to be paid within 12 months.
Question 2
There is a financial trouble in the company Peach Tree Inc. which is related to an overdue amoun
t which is to be paid to an equipment supplier. Peach Tree issues a notes payable which will become due within a period of 1 year (assuming). Therefore it will be a short term obligation.
Question 3
The new office as constructed by the company Pet supply Co. will take 10 years to complete which will then be classified as a non-current asset. Any amount which becomes payable due to this non-current asset will lead to the creation of Long-term debt and therefore it will be classified as a long term debt.
Question 4
Journal Entries
    Date
    Particulars
    Debit
    Credit
    Issuance of the note
     
     
     
     
    Jul-01
    Accounts Payable-Collar Co
    3,570
     
     
     To Notes Payable-Collar Co.
     
    3,570
     
     
     
     
     
     
     
     
    Payment of the note and any interest
    Sep-30
    Notes Payable-Collar Co.
    3,570
     
     
    Interest Expense ($3,570 * 10% * 90/360)
    89
     
     
     To Cash
     
    3659
Question 5
Journal Entries
    Date
    Particulars
    Debit
    Credit
    Issuance of the note
     
     
     
     
    Mar-01
    Equipment
    6,525
     
     
     To Notes Payable
     
    6,525
     
     
     
     
     
     
     
     
    Payment of the note and any interest
    Jun-30
    Notes Payable
    6,525
     
     
    Interest Expense ($6,525 * 15% * 120/360)
    326
     
     
     To Cash
     
    6,851
Question 6
Journal Entries
    Date
    Particulars
    Debit
    Credit
    Issuance of the note
     
     
     
     
    Aug-01
    Equipment
    3,500
     
     
     To Notes Payable
     
    3,500
     
     
     
     
    Payment of the note and any interest
    Jun-30
    Notes Payable
    3,500
     
     
    Interest Expense ($3,500 * 14% * 60/360)
    82
     
     
     To Cash
     
    3,582

Question 7
Proceeds = $3,500 - ($3,500 * 6% * 90/360)
= $3,447
    Date
    Particulars
    Debit
    Credit
    Issuance of the note
     
     
     
     
    Jun-01
    Cash
    3,447
     
     
    Interest Expense (3500-3447)
    53
    
     
     To Notes Payable
     
    3500
     
     
     
     
    Payment of the note
    Aug-30
    Notes Payable
    3,500
     
     
     To Cash
     
    3,500
Question 8
· Proceeds of the note: $6,750 - ($6,750 * 7% * 60/360)]
= $6,671
    Date
    Particulars
    Debit
    Credit
    Apr-01
    Cash
    6,671
     
     
    Interest Expense
    79
     
     
     To Notes Payable
     
    6,750
    Date
    Particulars
    Debit
    Credit
    May-01
    Notes Payable
    6,750
     
     
     To Cash
    
    6750
Question 9
Proceeds = $9,500 - ($9,500 * 9% * 120/360)
= $9,215
    Date
    Particulars
    Debit
    Credit
    Issuance of the note
     
     
     
     
    July-01
    Cash
    9,215
     
     
    Interest Expense (9500-9215)
    285
    
     
     To Notes Payable
     
    9,500
     
     
     
     
    Payment of the note
    Oct-30
    Notes Payable
    9,500
     
     
     To Cash
     
    9,500
Question 10
Taxable earnings for the week = 3150-(100*3) = $2,850    
Federal income tax withholding = 344.20 + (2850-1732)*0.28=    657.24
Question 11
Weekly gross earnings =...
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