Acc 205 Week 4 Liability Uop Exam Assignment

ACC 205 Week 4 Liability

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Individual Assignment - Liability

1.  Partner investments; journal entries. The LP partnership was formed on January 1, 19X7, by investments from Bill Levy and Marv Parcells. Levy contributed $30,000 cash and $80,000 of land. Parcells contributed cash of $50,000 and equipment with a value of $20,000.

a.    Prepare the journal entries needed to record the investments of Levy and Parcells.

2. Payroll accounting. Assume that the following tax rates and payroll information pertain to Brookhaven Publishing:

The company incurred a salary expense of $50,000 during February. All employees had earned less than $5,000 by month-end.

a. Prepare the necessary entry to record Brookhaven’s February payroll. The entry will include deductions for the following:

·  Social Security taxes

·  Medicare taxes

·  Federal income taxes withheld

·  State income taxes

·  Insurance withholdings

b. Prepare the journal entry to record Brookhaven’s payroll tax expense. The entry will include the following:

·  Matching Social Security taxes

·  Matching Medicare taxes

·  State unemployment taxes

·  Federal unemployment taxes

3.  Current liabilities: entries and disclosure. A review of selected financial activities of Visconti’s during 20XX disclosed the following:

Established a warranty liability for the XY-80, a new product. Sales are expected to total 1,000 units during the month. Past experience with similar products indicates that 2% of the units will require repair, with warranty costs averaging $27 per unit.

Accrued 3 days of salaries at a total cost of $1,400.

Instructions

a. Prepare journal entries to record the transactions.

b. Prepare adjusting entries on October 31 to record accrued interest.

c. Prepare the Current Liability section of Red Bank’s balance sheet as of October 31....