Analyzing and Computing Accrued Wages Liability and Expense Demski Company pays its employees on the 1st and 15th of each month. It is March 31 and the company is preparing financial statements for this quarter. Its employees have earned $50,000 since the 15th of March and have not yet been paid. How will Demski's balance sheet and income statement reflect the accrual of wages on March 31? Increase wages payable by $ 50,000 on the balance sheet. Increase wages expense by $ 50,000 Indicate the effect on the balance sheet and income statement accounts if Demski failed to make this accrual (for each account indicate whether it would be overstated or understated). Liabilities Understated Wages Expense Understated Income Overstated Stockholders' Equity Overstated on the income statement. :

Analyzing and Computing Accrued Wages Liability and Expense Demski Company pays its employees on the 1st and 15th of each month. It is March 31 and the company is preparing financial statements for this quarter. Its employees have earned $50,000 since the 15th of March and have not yet been paid. How will Demski's balance sheet and income statement reflect the accrual of wages on March 31? Increase wages payable by $ 50,000 on the balance sheet. Increase wages expense by $ 50,000 Indicate the effect on the balance sheet and income statement accounts if Demski failed to make this accrual (for each account indicate whether it would be overstated or understated). Liabilities Understated Wages Expense Understated Income Overstated Stockholders' Equity Overstated on the income statement. :

Financial Accounting

15th Edition

ISBN:9781337272124

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

Chapter11: Current Liabilities And Payroll

Section: Chapter Questions

Problem 4PB

See similar textbooks

Similar questions

Wages Payable Denton Corporation employs 50 workers in its plant. Each employee is paid $10 per hour and works seven hours per day, Monday through Friday. Employees are paid every Friday. The last payday was Friday, September 19. Required Compute the dollar amount of the weekly payroll. Prepare the journal entry on Friday, September 26, for the payment of the weekly payroll. Denton prepares monthly financial statements. Prepare the adjusting journal entry on Tuesday, September 30, the last day of the month. Prepare the journal entry on Friday, October 3, for the payment of the weekly payroll. Will net income for the month of September be understated or overstated if Denton doesnt bother with an adjusting entry on September 30? Explain your answer.
SUTA taxes on July 31, 20--. WORKERS COMPENSATION INSURANCE AND ADJUSTMENT Columbia Industries estimated that its total payroll for the coming year would be 385,000. The workers compensation insurance premium rate is 0.2%. REQUIRED 1. Calculate the estimated workers compensation insurance premium and prepare the journal entry for the payment as of January 2, 20--. 2. Assume that Columbia Industries actual payroll for the year is 396,000. Calculate the total insurance premium owed and prepare a journal entry as of December 31, 20--, to record the adjustment for the underpayment. The actual payment of the additional premium will take place in January of the next year.
An analysis of the payroll for the month of November for CinMar Inc. reveals the information shown: All regular time Andrews, Lomax, and Herzog are production workers, and Dimmick is the plant manager. Hendrick is in charge of the office. Cumulative earnings paid (before deductions) in this calendar year prior to the payroll period ending November 8 were as follows: Andrews, 21,200; Lomax, 6,800; Herzog, 11,500; Dimmick, 116,200; and Hendrick, 32,800. The solution to this problem requires the following forms, using the indicated column headings: 1. Prepare an employee earnings record for each of the five employees. 2. Prepare a payroll record for each of the four weeks. 3. Prepare a labor cost summary for the month. 4. Prepare journal entries to record the following: a. The payroll for each of the four weeks. b. The payment of wages for each of the four payrolls. c. The distribution of the monthly labor costs per the labor cost summary. d. The company's payroll taxes covering the four payroll periods.
Noura Company offers an annual bonus to employees (to be shared equally) if the company meets certain net income goals. Prepare the journal entry to record a $14,000 bonus owed (but not yet paid) to its workers at calendar year-end. View transaction list Journal entry worksheet < 1 Record the expected bonus costs. Note: Enter debits before credits. Date December 31 General Journal Debit Credit 7 Record entry Clear entry View general journal
Noura Company offers an annual bonus to employees (to be shared equally) if the company meets certain net income goals. Prepare the journal entry to record a $14,000 bonus owed (but not yet paid) to its workers at calendar year-end. View transaction list Journal entry worksheet < 1 Record the expected bonus costs. Note: Enter debits before credits. Date December 31 General Journal Debit Credit Clear entry View general journal Record entry
Gamma Company makes the following entry whenever it pays employee wages: Dr Wage Expense Cr Cash Gamma also accrues unpaid wages at the end of month with the entry Dr Wage Expense Cr Wages Payable At the start of June the balance in the Wages Payable account was $18,000. During June Gamma paid $30,340 in wages charging it all to Wage Expense. Analysis shows there should be $4,560 in accrued wages at the end of June. Required: What is the correct amount of wage expense to report in June's Income Statement? $ [
Accounting for payroll and payroll taxes Electronics Service Co. pays salaries monthly on the last day of the month. The following information is available from Electronics for the month ended December 31, 2016: Administrative salaries$96,000 Sales salaries 57,000 Office salaries 38,000 Assume the Social Security tax rate is 6 percent on the first $110,000 of salaries. Duke reached the $110,000 amount in September. Hilis salary in December amounted to S11,500 and is included in the $96,000. No one else will reach the $110,000 amount for the year. None of the employee salaries are subject to unemployment tax in December. Other amounts withheld from salaries in December were as follows: Federal income tax S21,500 State incomne tax 11,200 Employee savings plan 4,000 Required a. Prepare the journal entry to record the payment of payroll on December 31, 2016. b. Prepare the journal entry to record the payroll tax expense for Electronics Service Co. for December 2016. 4 0196/11 ratings) for…
Question. Electronics Service Co. pays salaries monthly on the last day of the month. The following information is available from Electronics for the month ended December 31, Year 1: Administrative salaries $96,000 Sales salaries 57,000 Office salaries 38,000 Assume the Social Security tax rate is 6 percent on the first $130,000 of salaries. Duke reached the $130,000 amount in December. His salary is $11,500 per month and is included in the $96,000. No one else will reach the $130,000 amount for the year. None of the employee salaries are subject to unemployment tax in December. Other amounts withheld from salaries in December were as follows: Federal income tax $21,500 State income tax 11,200 Employee savings plan 4,000 Required a. Determine the net pay for employee salary expenses on December 31, Year 1. b. Determine the amount of payroll tax expense for Electronics Service Co. for December, Year 1.
An employee with an annual salary of $77278 is paid every month. What is the gross pay per pay period? Report your answer to two decimal places AND with correct units. Answer:
The university satellite office operates five days per week with a daily payroll of $5,000. Employees are paid every Saturday for the workweek just completed (Monday through Friday). The last day of the month is Wednesday, October 31. What is the effect of the correct adjustment at October 31? A. Decrease Wages Expense and increase Wages Payable by $15,000 B. Increases Wages Payable and increases Wages Expense by $25,000 C. Increase Wages Payable and decreases Cash by $10,000 D. Increases Wages Expense and increases Wages Payable by $15,000
Mason Painting Services has a weekly payroll of $25,000. December 31 falls on Wednesday and Mason will pay its employees the following Monday (January 5) for the previous full week. Assume that Mason has a five−day workweek and has an unadjusted balance in Salaries Expense of $800,000 at December 31. What amount should be debited to Salaries Expense on December 31? A. $15,000 B. $25,000 C. $10,000 D. $800,000
Richard Corp has the following data for the third week of December: Employee Name Classification Hours Worked Rate per Hour Kuhl Laborer 45 50 Aileen Office Secretary 46 45 Jose Laborer 50 52 Jay Factory Supervisor 55 48 Richmond Sales agent 52 60 Edward Laborer 48 45 The following are to be deducted from the gross earnings of employees: Withholding taxes - 5% Social Security System contributions - 3% Philippine Health Insurance - 1% Home Development Mutual Fund - 1% Richard Corp paid its employees one and half times the regular rate for hours worked in excess of 40 hours. a. How much is the gross payroll? b. How much is the amount charged to Work in Process? c. How much is the amount charged to manufacturing overhead? d. How much is the total amount charged to Selling and Administrative expenses?