A2 - 1.00 Review Game

Ben's Barbershop's balance sheet contains no inventory account. This company would be classified as a:

• merchandising business.
• manufacturing business.
• construction business.
• service business.

Booming Corporation purchased CDs on account from Hear All Supply Company, $500, Purchase Invoice No. 5. The correct entry to record the transaction is:

• debit Cash, $500; credit Hear All Supply Company, $500.
• debit Hear All Supply Company, $500; credit Cash, $500.
• debit Purchases-CDs, $500; credit Accounts Payable/Hear All Supply Company, $500.
• debit Accounts Payable/Hear All Supply Company, $500; credit Purchases-CDs, $500.

Betty Lou's Variety Store recorded cash and credit card sales of shoes, $500, pocketbooks, $300, and sales tax, $50, for a total of $850, Tape 33. The journal entry to record the transaction is:

• debit Sales-Shoes, $500, Sales-Pocketbooks, $300, Sales Tax Payable, $50; credit Cash, $850.
• debit Cash, $850; credit Sales-Shoes, $500, Sales-Pocketbooks, $300, Sales Tax Payable, $50.
• debit Cash, $800; credit Sales, $800.
• debit Sales, $800; credit Cash, $800.

Candy Corporation issued a credit to Sweet Shop for damaged candy, $50, plus sales tax, $6, total $56, from Sales Invoice No. 5, Credit Memo No. 46. The journal entry to record the transaction is:

• debit Cash, $56; credit Sales, $56.
• debit Sales, $50; credit Cash, $50.
• debit Sales Returns and Allowances-Candy, $50, Sales Tax Payable, $6; credit Accounts Receivable/Sweet Shop, $56.
• debit Accounts Receivable/Sweet Shop, $56; credit Sales Returns and Allowances-Candy, $50, Sales Tax Payable, $6.

Daisy Corporation received cash on account from Hamilton's Music Store, $1,164, covering Sales Invoice No. 88 for CDs, $1,200 ($1,000 plus sales tax $200), less a 3% discount, $36, Receipt No. 81. The journal entry to record the transaction is:

• debit Sales, $1,200; credit Cash, $1,200.
• debit Sales, $1,164; credit Cash, $1,164.
• debit Cash $1,164, Sales Discount-CDs, $36; credit Accounts Receivable/Hamilton's Music Store, $1,200.
• debit Accounts Receivable/Hamilton's Music Store, $1,200; credit Cash, $1,164, Sales Discount-CDs, $36.

Blastin' Sound Music shop has $2,000 in Salaries-Audio, $2,500 in Salaries-Video, $325 in Social Security withholding, $85 in Medicare withholding, $400 in federal income tax withholding, $300 in state income tax withholding, and $240 in life insurance premiums withholding. The correct entry for recording this company payroll is:

• debit Salary Expense-Audio, $2,000, Salary Expense-Video, $2,500; credit Social Security Tax Payable, $325, Medicare Tax Payable, $85, Federal Income Tax Payable, $400, State Income Tax Payable, $300, Life Insurance Premiums Payable, $240, Cash $3,150.
• debit Social Security Tax Payable, $325, Medicare Tax Payable, $85, Federal Income Tax Payable, $400, State Income Tax Payable, $300, Life Insurance Premiums Payable, $240; credit Salary Expense-Audio, $2,000, Salary Expense-Video, $2,500, Cash, $3,150.
• debit Salary Expense-Audio, $2,000, Salary Expense-Video, $2,500, Cash, $3,150; credit Social Security Tax Payable, $325, Medicare Tax Payable, $85, Federal Income Tax Payable, $400, State Income Tax Payable, $300, Life Insurance Premiums Payable, $240.
• debit Salary Expense-Audio, $2,000, Salary Expense-Video, $2,500, Social Security Tax Payable, $325, Medicare Tax Payable, $85, Federal Income Tax Payable, $400, State Income Tax Payable, $300, Life Insurance Premiums Payable, $240; credit Cash, $3,150.

Carson’s Candy Shoppe has $2,000 in gross pay, $124 in Social Security withholding, $29 in Medicare withholding, $500 in federal income tax withholding, and $100 in state income tax withholding. The federal unemployment tax rate is 0.8%. What is the employer's federal unemployment tax for the pay period?

• $10

• $16

• $160

• $500

Watauga Office Supply paid federal unemployment taxes of $56. The entry to journalize the payment of the unemployment taxes is:

• debit Payroll Tax Expense $56; credit Cash $56.
• debit Cash $56; credit Federal Unemployment Tax Payable $56.
• debit Federal Unemployment Tax Payable $56; credit Cash $56.
• debit Federal Unemployment Tax Payable $56; credit Payroll Tax Expense $56.

Greg has gross earnings of $245.00, Social Security withholding of $15.19, Medicare withholding of $3.55, federal income tax withholding of $50.00, and state income tax withholding of $15.93. What are Greg's total deductions?

• $84.67

• $34.67

• $68.74

• $160.33

The accountant for the Eckland Company is preparing a Statement of Gross Profit with Component Percentages. Based on the information provided, what is the Merchandise Available for Sale for the Clothing Division? Review Figure 1.03-A

• $35,500

• $48,000

• $68,000

• $88,500