The following data for Flexco Inc. relate to the payroll for the week ended Dece

Question

The following data for Flexco Inc. relate to the payroll for the week ended December 7, 2014:

Employees Grove and Seaver are office staff, and all of the other employees are sales personnel. All sales personnel are paid 1½ times the regular rate for all hours in excess of 40 hours per week. The social security tax rate is 6.0% of each employee's annual earnings, and Medicare tax is 1.5% of each employee's annual earnings. The next payroll check to be used is No. 328.

Instructions
1. Prepare a payroll register for Flexco Inc. for the week ended December 7, 2014. Use the following columns for the payroll register: Employee, Total Hours, Regular Earnings, Overtime Earnings, Total Earnings, Social Security Tax, Medicare Tax, Federal Income Tax, U.S. Savings Bonds, Total Deductions, Net Pay, Ck. No., Sales Salaries Expense, and Office Salaries Expense.
2. Journalize the entry to record the payroll for the week.

Explanation / Answer

An option is the right, but not the obligation, to buy or sell an asset for a given price on or before a given date. The price is called the exercise or strike price, and the date is called the exercise date or expiration date of the option. The right to buy the asset is known as a call option. The payoff from a call option equals $0 if the value of the underlying asset is less than the exercise price at expiration. If the value of the underlying asset is higher than the exercise price at expiration, then the payoff from the call option is equal to the value of the asset value minus the exercise price. The right to sell the asset is called a put

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