Question :

A company has two employees. The company's net salaries for the month of January were $8,000.

• The federal income tax rate for both employees is 15 percent.
• The FICA-social security tax rate is 6.2 percent
• The FICA-Medicare tax rate is 1.45 percent

Determine the amount of employee taxes withheld and organize the company's journal entry to record the January payroll considering these were the only deductions

Pastimes Co. offers its employees a bonus equivalent to 2% of the company's total income. The estimated total income for the year is expected to be $850,000. Prepare the common journal entry to record the employee bonus plan expense.

Smith plans to leave the P&R Partnership. The recorded value of her capital account is $48,000. The residual partners Nelson and James agree to pay Smith $40,000 cash and Smith accepts. The partners share income and loss evenly. Purpose the general journal entry to record the withdrawal from the partnership Dave's and Sam Company is organized as a partnership. At the prior year-end, Sam's equity balance was $258,000 and Dave's was $212,000. For the present year, partnership total income is $125,000 ($75,000 allocated to Sam and $50,000 allocated to Dave); withdrawals are $77,000 ($40,000 for Sam and $37,000 for Dave).

a) Evaluate the total partnership return on equity, to the nearest tenth of a percent.

b) Determine Sam's return on equity, to the nearest tenth of a percent.

On 1^st January, 2012, Flexall Company issues bonds that have a $900,000 par value, mature in 25 years, and pay 8 percent interest semi-annually on June 30 and December 31.

Prepare the journal entry to record the issuance of the bonds on 1^st January, 2011 assuming:

a) The bonds are sold at par.

b) The bonds are issued at 96.

c) The bonds are issued at 104.

On 1^st January, 2011, Jefferson issues bonds with a par value of $50,000, mature in 3 years, and pay 8.5% interest semiannually on June 30 and 31^st December. The annual market rate at the date of issuance is 12 percent, and the bonds are sold for $48,650.

a) Evaluate the amount of the discount on these bonds at issuance?

b) How much net bond interest expense may be recognized over the life of these bonds?