Chapter 9 - Accounting For Current Liabilities Flashcards
Entry to record Sales Tax Payable
DEBIT - Cash
CREDIT - Sales
CREDIT - Sales Tax Payable
Entry to record Unearned Revenue
DEBIT - Cash
CREDIT - Unearned Revenue
Entry to record when revenue is earned
DEBIT - Unearned Revenue
CREDIT - Revenue
Entry to replace an Account Payable with a Note Payable
DEBIT - Accounts Payable
CREDIT - Cash (if given)
CREDIT - Notes Payable
Entry to record payment of note payable when due
DEBIT - Notes Payable
DEBIT - Interest Expense
CREDIT - Cash
Gross Pay
Total compensation an employee earns BEFORE deductions
Net Pay
Aka - take home pay
Gross pay AFTER all deductions
Payroll deductions
Aka - withholdings
Amounts withheld from employees gross pay, either required or voluntary
FICA taxes
Federal Insurance Contributions Act taxes
A federal social security system that provides retirement, disability, survivorship, and medical benefits to qualified workers. Employees cover the costs of the system.
Two groups
- Social Security taxes
- retirement
- disability
- survivorship
- Medicare taxes
- Medical
Employer Taxes
FICA
Unemployment taxes
Voluntary deductions
Other amounts withheld from employee’s earnings at their request
Entry to record accrued payroll
DEBIT - Payroll Expense
CREDIT - Payroll Liabilities
Entry to record payment of payroll to employee
DEBIT - Payroll payable
CREDIT - Cash
Internal Controls for Payroll
- Employee Hiring
- Payroll Preparation
- Timekeeping
- Payroll Payment
Current portion of long term debt
The part of the long term debt due within one year of the operating cycle
Estimated liability
An obligation that is of an uncertain amount but can be reasonable estimated.
Ex:
- Pensions
- Health care
- Vacation pay
Entry to record employee benefits
DEBIT - Benefits Expense
CREDIT - Payable accounts
