The following list includes several payroll-related items used in preparing the weekly payroll for Outdoor Adventures. These items are included in either the entry to record the payroll or the entry to record the employer’s payroll taxes. Employees’ federal income tax, Employer’s social security tax, U.S. savings bonds, Employer’s Medicare tax, Federal unemployment tax, Employees’ state income tax, Union dues, Employees’ social security tax, State unemployment tax, Employees’ Medicare tax. Use the form provided in your working papers. Place a check mark in the column that describes the entry in which the item is recorded: -entry to record the payroll -entry to record the employer’s payroll taxes.

Showbiz Video completed the following payroll transactions during the first two weeks of December. Showbiz Video pays its employees on a biweekly basis (every two weeks). In your working papers: 1. Record the December 13 transactions on page 38 in the general journal. 2. Post both payroll entries to the appropriate general ledger accounts. 3. Journalize and post the December 16 transactions. $$ \begin{array}{rl} \text{Date} & \text{Transactions}\\ \text{Dec. 13} & \text{Wrote Check 2206 to pay the payroll of \$3,840.58 (gross}\\ \text{ } & \text{earnings) for the pay period ending December 13. The}\\ \text{ } & \text{following amounts were withheld: FICA taxes, \$238.12 for}\\ \text{ } & \text{social security and \$55.69 for Medicare; employees’ federal}\\ \text{ } & \text{income taxes, \$639.00; employees’ state income taxes, \$96.02;}\\ \text{ } & \text{insurance premium, \$21.00; U.S. savings bonds, \$20.00.}\\ \text{13} & \text{Recorded the employer’s payroll taxes (FICA tax rates, 6.2\\% for}\\ \text{ } & \text{social security and 1.45\\% for Medicare; federal unemployment}\\ \text{ } & \text{tax rate, 0.8%; state unemployment tax rate, 5.4%). No}\\ \text{ } & \text{employee has reached the maximum taxable amount.}\\ \text{16} & \text{Paid the amounts owed to the federal government for }\\ \text{ } & \text{employees’ federal income taxes and FICA taxes, Check 2215. }\\ \text{16} & \text{Purchased U.S. savings bonds for employees for \$100.00, }\\ \text{ } & \text{Check 2216. }\\ \text{16} & \text{Paid \$148.00 to American Insurance Company for employees’}\\ \text{ } & \text{insurance, Check 2217.}\\ \end{array} $$ Identify the payroll accounts that have a balance after entries have been posted.

The following account balances appear in the general ledger for Soap Box Laundry on April 30. Record the payment of the four liability accounts on page 34 of the general journal.

$$\begin{array}{ll} \text{General Ledger} & \text{ }\\ \text{Social Security Tax Payable} & \text{$\$ 318.55$}\\ \text{State Income Tax Payable} & \text{205.60}\\ \text{Medicare Tax Payable} & \text{113.28}\\ \text{Employees' Federal} & \text{ }\\ \text{Income Tax Payable} & \text{286.00}\\ \end{array}$$

The totals of the payroll register for Kits & Pups Grooming are shown in your working papers. On December 31 the owner, Abe Shultz, wrote Check 1400 to pay the payroll. In your working papers: 1. Record the payroll entry in the general journal. 2. Post the entry to the general ledger accounts.

Prepare journal entries to record the following production activities. 1. Incurred $75,000 of direct labor in production (credit Factory Wages Payable). 2. Incurred$20,000 of indirect labor in production (credit Factory Wages Payable). 3. Paid factory payroll.

Waylander Coatings Company purchased waterproofing equipment on January 6 for $320,000. The equipment was expected to have a useful life of four years, or 20,000 operating hours, and a residual value of$35,000. The equipment was used for 7,200 hours during Year 1, 6,400 hours in Year 2, 4,400 hours in Year 3, and 2,000 hours in Year 4.

1. Determine the amount of depreciation expense for the years ended December 31, Year 1, Year 2, Year 3, and Year 4, by (A) the straight-line method, (B) the units-of-activity method, and (C) the double-declining-balance method. Also determine the total depreciation expense for the four years by each method. The following columnar headings are suggested for recording the depreciation expense amounts:

$$\begin{array}{cccc} & \text { Straight- } & \text { Units-of- } & \text { Double-Declining- } \\ \text { Year } & \text { Line } & \text { Activity } & \text { Balance } \\ \hline \end{array}$$

2. What method yields the highest depreciation expense for Year 1?
3. What method yields the most depreciation over the four-year life of the equipment?

Distinguish between the two types of payroll deductions and give examples of each.

Gruver Corporation reported the following payroll-related costs for the month of February:

$$\begin{array}{|cc} \text { Gross pay (wages expense) } & \cdots\cdots\cdots\cdots\cdots\cdots\cdots\cdots & \$250,000\\ \text {Social Security and Medicare taxes} & \cdots\cdots\cdots\cdots\cdots\cdots\cdots & 19,125 \\ \text{Federal and state unemployment taxes} & \cdots\cdots\cdots\cdots\cdots\cdots\cdots & 15,500 \\ \text {Workers’ compensation insurance} & \cdots\cdots\cdots\cdots\cdots\cdots\cdots\cdots & 8,500\\ \text {Group health and life insurance benefits } & \cdots\cdots\cdots\cdots\cdots\cdots\cdots & 10,000\\ \text {Employee pension plan benefits} & \cdots\cdots\cdots\cdots\cdots\cdots\cdots\cdots & 22,875\\ \text {Total payroll costs for February } & \cdots\cdots\cdots\cdots\cdots\cdots\cdots & \$326,000\\ \end{array}$$

Gruver’s insurance premiums for workers’ compensation and group health and life insurance were paid for in a prior period and recorded initially as prepaid insurance expense. Withholdings from employee wages in February were as follows:

$$\begin{array}{|cc} \text { State income tax withholdings } & \cdots\cdots\cdots\cdots\cdots\cdots\cdots\cdots & \$5,875\\ \text {Federal income tax withholdings} & \cdots\cdots\cdots\cdots\cdots\cdots\cdots & 56,000 \\ \text{Social Security and Medicare tax withholdings} & \cdots\cdots\cdots\cdots\cdots\cdots\cdots & 19,125 \\ \end{array}$$

a. Record Gruver's gross wages, employee withholdings, and employee take-home pay for February.

Abe Shultz owns Kits & Pups Grooming and uses the following accounts: $$ \begin{matrix} \text{General Ledger} & \text{ }\\ \hline \text{101 Cash in Bank} & \text{205 Accounts Payable—}\\ \text{115 Accounts Receivable—} & \text{Dogs & Cats Inc.}\\ \text{Martha Giles} & \text{301 Abe Shultz, Capital}\\ \text{125 Office Equipment} & \text{ }\\ \text{130 Office Furniture} & \text{ }\\ \text{140 Grooming Equipment} & \text{ }\\ \end{matrix} $$ For each transaction: 1. In your working papers, prepare a T account for each account listed. 2. Using the appropriate T accounts, analyze and record each of the following business transactions. Identify each transaction by number. 3. After recording all transactions, write the word Balance on the normal balance side of each T account. Then compute and record the balance for each account. $$ \begin{array}{rl} \text{Date} & \text{Transactions}\\ \hline \text{May 1} & \text{1. Abe Shultz invested an additional $\$45,000$ cash in his business.}\\ \text{5} & \text{2. Bought grooming equipment on account from Dogs & Cats Inc. for $\$8,500$.}\\ \text{10} & \text{3. Purchased an office lamp for $\$85$, Check 150.}\\ \text{14} & \text{4. Abe Shultz transferred his personal typewriter, worth $\$200$, to the business.}\\ \text{19} & \text{5. Made a $\$3,000$ payment on the grooming equipment bought on account, Check 151.}\\ \text{22} & \text{6. Sold the typewriter on account to Martha Giles for $\$200$.}\\ \text{29} & \text{7. Bought a photocopier for $\$1,500$, Check 152.}\\ \text{31} & \text{8.Received a $\$100$ payment for the typewriter sold on account.}\\ \end{array} $$

Identify the function of the large intestine.

How are vegetables blanched?

Which form of the food did you find more appealing? Why?

Magnum Plus, Inc., is a manufacturer of hunting supplies. The following is a summary of the company’s annual payroll-related costs:

$$\begin{array}{|cc} \text {Wages and salaries expense (of which \$2,200,000 was withheld from} & & & \\ \text { employees’ pay and forwarded directly to tax authorities) } & \cdots\cdots\cdots\cdots\cdots\cdots\cdots\cdots & \$7,200,000\\ \text {Payroll taxes} & \cdots\cdots\cdots\cdots\cdots\cdots\cdots & 580,000 \\ \text{Workers’ compensation premiums} & \cdots\cdots\cdots\cdots\cdots\cdots\cdots & 250,000 \\ \text {Group health insurance premiums} & \cdots\cdots\cdots\cdots\cdots\cdots\cdots\cdots & 725,000\\ \text {Contributions to employees’ pension plan} & \cdots\cdots\cdots\cdots\cdots\cdots\cdots & 450,000\\ \end{array}$$

c. Express total payroll-related costs as a percentage of (1) total wages and salaries expense, and (2) employees' take-home pay. (Round computations to the nearest 1 percent.)

Magnum Plus, Inc., is a manufacturer of hunting supplies. The following is a summary of the company’s annual payroll-related costs:

$$\begin{array}{|cc} \text {Wages and salaries expense (of which \$2,200,000 was withheld from} & & & \\ \text { employees’ pay and forwarded directly to tax authorities) } & \cdots\cdots\cdots\cdots\cdots\cdots\cdots\cdots & \$7,200,000\\ \text {Payroll taxes} & \cdots\cdots\cdots\cdots\cdots\cdots\cdots & 580,000 \\ \text{Workers’ compensation premiums} & \cdots\cdots\cdots\cdots\cdots\cdots\cdots & 250,000 \\ \text {Group health insurance premiums} & \cdots\cdots\cdots\cdots\cdots\cdots\cdots\cdots & 725,000\\ \text {Contributions to employees’ pension plan} & \cdots\cdots\cdots\cdots\cdots\cdots\cdots & 450,000\\ \end{array}$$

b. Compute the net amount of cash actually paid to employees (their take-home pay).