9. When Grier Mtfg. makes an entry to provide for the cest of a product warraaty

Question

9. When Grier Mtfg. makes an entry to provide for the cest of a product warraatyr expense should be included in the an entry to provide for the cost of a product warranty the a. period the cash is collected for a product sold on account b. future period when the cost of repairing the product is paid c. period of the sale of the product d. future period when the product is repaired or replaced 10. Define Gross Pay: a. Take-home pay b. The amount of the paycheck c. Salaries after taxes are deducted. d. Deductions withheld by an employer. e. Total compensation earned by an employee before any deductions. through Friday. If December 31, the last day of the accounting year, falls on Thursday, Executive would make an adjusting entry that would a. increase Wages Expense $8,000. b. decrease Wages Payable $2,000. c. decrease Cash $8,000. d. increase Wages Payable $2,000. 12. Which of the following would most likely be classified as a current liability? a. two-year notes payable b. bonds payable c. mortgage payable d. unearned rent 13. Which of the following taxes are employers required to withhold from employees? a. FICA tax b. FICA tax, state, and federal unemployment tax c. state unemployment tax d. federal unemployment tax 14. Employees of Headly Inc. earn $6,000 per day, work five days per week, Monday through Friday, and get aid ever!riday, ?ftheprevious payday was January 26 and the accounting period ends on January 31, what amount is the ending balance in the wages payable account? a. $18,000 b. $6,000 c. $30,000 d. None of these choices.

Explanation / Answer

Solution 9:

When Grier Mfg. makes an entry to provide for the cost of a product warranty the expense should be included in the period of the sale of product. Hence option c is correct.

Solution 10:

Gross pay is "Total compensation earned by an employee before any deductions"

Hence option e is correct.

Solution 11:

Wage expense accrued on december 31 for 4 days,

therefore wages for 4 days = $10,000/5*4 = $8,000

Therefore adjusting entry on December 31, increase wage expense by $8,000

Hence option a is correct.

Solution 12:

Unearned rent most likely to be classified as current liability. Hence option d is correct.

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