COLLEGE ACCOUNTING ETEXT+CONNECT ACCESS
16th Edition
ISBN: 9781264624256
Author: Haddock
Publisher: MCG
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Question
Chapter 11, Problem 6PA
1.
To determine
Calculate the estimated amount of worker’s compensation insurance premium for office and shop employees.
1.
Expert Solution
Explanation of Solution
Worker’s Compensation Insurance: Worker’s compensation insurance covers the amount of insurance to be provided to an employee in case of injury suffered while working on the job. This insurance also compensates the families of deceased employees, if the death occurs in course of employment.
The purpose of providing worker’s compensation insurance to employees is to compensate them for the loss of wages due to occurrence of injury. Under this type of insurance, medical benefits are also provided to injured employees.
Calculate the estimated amount of worker’s compensation insurance premium for office and Shop work.
Hence, the estimated amount of worker’s compensation insurance premium for office work and Shop work is $192 and $18,480 respectively.
2.
To determine
Journalize the entry to record the payment of the estimated premium on January 15, 2019.
2.
Expert Solution
Explanation of Solution
Debit and credit rules:
- Debit an increase in asset account, increase in expense account, decrease in liability account, and decrease in
stockholders’ equity accounts. - Credit decrease in asset account, increase in revenue account, increase in liability account, and increase in stockholders’ equity accounts.
Prepare general journal entry to record the payment of the estimated premium on January 15, 2019.
| General Journal | Page 8 | ||||||
| Date | Accounts and Explanation | Post Ref | Debit ($) | Credit ($) | |||
| 2019 | Prepaid Workers’ Compensation Insurance | 18,672 | |||||
| January | 15 | Cash | 18,672 | ||||
| (To record the payment of the estimated premium) | |||||||
Table (1)
- Prepaid Workers’ Compensation Insurance is an asset and it is increased. So, debit it by $18,672.
- Cash is an asset and it is decreased. So, credit it by $18,672.
Working note:
Calculate the total estimated amount of worker’s compensation insurance premium.
3.
To determine
Calculate the actual amount of worker’s compensation insurance premium and the balance due for office and shop work.
3.
Expert Solution
Explanation of Solution
Worker’s Compensation Insurance: Worker’s compensation insurance covers the amount of insurance to be provided to an employee in case of injury suffered while working on the job. This insurance also compensates the families of deceased employees, if the death occurs in course of employment.
The purpose of providing worker’s compensation insurance to employees is to compensate them for the loss of wages due to occurrence of injury. Under this type of insurance, medical benefits are also provided to injured employees.
Calculate the total actual amount of worker’s compensation insurance premium and the balance due for office and shop work.
|
Actual Earnings (A) |
Insurance Rate (B) |
Actual Premiums (c) = (A) x (B) | |
| Office work | $69,960 | $0.30/$100 | $209.88 |
| Shop work | $315,320 | $6.00/$100 | $18,919.20 |
| Total | $19,129.08 | ||
| Less: Estimated premiums paid | $18,672.00 | ||
| Additional premium due | $457.08 |
Table (2)
4.
To determine
Journalize the entry to adjust the workers’ compensation insurance expense.
4.
Expert Solution
Explanation of Solution
Prepare general journal entry to record the adjustment of the workers’ compensation insurance expense.
| General Journal | Page 98 | ||||||
| Date | Accounts and Explanation | Post Ref | Debit ($) | Credit ($) | |||
| 2019 | Workers’ Compensation Insurance Expense | 457.08 | |||||
| December | 31 | Workers’ Compensation Insurance Payable | 457.08 | ||||
| (To adjust workers’ compensation insurance expense) | |||||||
| December | 31 | Workers’ Compensation Insurance Expense | 18,672 | ||||
| Prepaid Workers’ Compensation Insurance | 18,672 | ||||||
| (To adjust prepaid workers’ compensation insurance) | |||||||
Table (3)
- Workers’ Compensation Insurance Expense is an expense and it decreases the equity value. So, debit it by $457.08.
- Workers’ Compensation Insurance Payable is a liability and it is increased. So, debit it by $457.08.
- Workers’ Compensation Insurance Expense is an expense and it decreases the equity value. So, debit it by $18,672.
- Prepaid Workers’ Compensation Insurance is an asset and it is decreased. So, credit it by $18,672.
Analyze: If all wages belong to shop work, then the estimated premium that will record on January 15, 2019 would be $22,320
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The payroll records of Brownlee Company provided the following information for the weekly pay period ended March 23, 2018:Required:1. Enter the relevant information in the proper columns of a payroll register and complete the register; calculate CPP and EI deductions. Charge the wages of Kathy Sousa to Office Wages Expense and the wages of the remaining employees to Service Wages Expense. Calculate income tax deductions at 20% of gross pay. Employees are paid an overtime premium of 50% for all hours in excess of 40 per week. Payroll Week Ended March 23, 2018 (Q1 Posted earlier, just provided info)
2. Prepare General Journal entries to record the payroll register information, including the employer’s expenses
Record the journal:
1. Record the payroll register for the pay period ending March 23.
2. Record the payroll taxes.
The payroll records of Brownlee Company provided the following information for the weekly pay period ended March 23, 2018:Required:1. Enter the relevant information in the proper columns of a payroll register and complete the register; calculate CPP and EI deductions. Charge the wages of Kathy Sousa to Office Wages Expense and the wages of the remaining employees to Service Wages Expense. Calculate income tax deductions at 20% of gross pay. Employees are paid an overtime premium of 50% for all hours in excess of 40 per week. Payroll Week Ended March 23, 2018 (Image 1)
Chapter 11 Solutions
COLLEGE ACCOUNTING ETEXT+CONNECT ACCESS
Ch. 11 - Prob. 1.1SRQCh. 11 - Prob. 1.2SRQCh. 11 - Prob. 1.3SRQCh. 11 - Prob. 1.4SRECh. 11 - Prob. 1.5SRECh. 11 - Prob. 1.6SRACh. 11 - Prob. 2.1SRQCh. 11 - Prob. 2.2SRQCh. 11 - Prob. 2.3SRQCh. 11 - Prob. 2.4SRE
Ch. 11 - Prob. 5SRECh. 11 - At the end of the year, the business has a balance...Ch. 11 - Prob. 1CSRCh. 11 - Prob. 2CSRCh. 11 - Prob. 3CSRCh. 11 - Prob. 4CSRCh. 11 - Prob. 5CSRCh. 11 - Prob. 1DQCh. 11 - Prob. 2DQCh. 11 - Prob. 3DQCh. 11 - Prob. 4DQCh. 11 - Prob. 5DQCh. 11 - Prob. 6DQCh. 11 - Prob. 7DQCh. 11 - Prob. 8DQCh. 11 - Prob. 9DQCh. 11 - Prob. 10DQCh. 11 - Prob. 11DQCh. 11 - Prob. 12DQCh. 11 - Prob. 13DQCh. 11 - Prob. 14DQCh. 11 - Prob. 15DQCh. 11 - Prob. 16DQCh. 11 - Prob. 17DQCh. 11 - Prob. 18DQCh. 11 - Prob. 19DQCh. 11 - Prob. 1ECh. 11 - Prob. 2ECh. 11 - At the end of the weekly payroll period on June...Ch. 11 - Prob. 4ECh. 11 - Prob. 5ECh. 11 - Prob. 6ECh. 11 - Prob. 7ECh. 11 - Prob. 8ECh. 11 - Prob. 1PACh. 11 - Prob. 2PACh. 11 - Prob. 3PACh. 11 - Prob. 4PACh. 11 - Prob. 5PACh. 11 - Prob. 6PACh. 11 - Prob. 1PBCh. 11 - A payroll summary for Todays Teen owned by Nikki...Ch. 11 - Prob. 3PBCh. 11 - Prob. 4PBCh. 11 - Prob. 5PBCh. 11 - Prob. 6PBCh. 11 - Prob. 1CTPCh. 11 - The Valley Voice is a local newspaper that is...Ch. 11 - Prob. 1MFCh. 11 - Prob. 2MFCh. 11 - Why should management be concerned about the...Ch. 11 - Prob. 4MFCh. 11 - Prob. 1EDCh. 11 - Prob. 1FSA
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