Day 51 - Nature of Corporations

1. 4P3R next section in text: Nature of Corporations (pages 498-499)
• preview
• predict
• prior knowledge
• purpose
• read and write
• re-read and adjust
• review (create review tool)
2. Create your own interview questions for Nature of Corporations

Day 154: Ch 12 Preview

We are skipping chapter 11

Preview the Chapter 12 Questions.
Watch the following Chapter 12 videos and take notes as you watch:

• Intro to Corporations (5:10)
• Corporate Form (5:32) 
• Stock Issuance and Treasury Stock (12:11)     
• Cash and Stock Dividends (7:57)

Complete the Chapter 12 Review Questions

Day 153: Ch 10 Quiz B

Day 152: Review Ch 10 Quiz

Day 151: Chapter 10 Quiz

Day 150: Study Day

Prepare the journal entry for the following transactions:

1. The May 1 payroll register showed Gross Pay of $400,000. Employees are paid one week after the end of a pay period. The only deductions are those required by statute (use the following rates: 6.2% and 1.45% for the FICA amounts, hypothetical federal percentage of 15%, and a state rate of 5%).
2. The company also records payroll taxes at the same time as they record the payroll. Use the following rates: 6.2% and 1.45% for the FICA amounts, 5.4% and .8% for the unemployment taxes.
3. The May 15 payroll register showed Gross Pay of $500,000. Employees are paid one week after the end of a pay period. The only deductions are those required by statute (use the following rates: 6.2% and 1.45% for the FICA amounts, hypothetical federal percentage of 15%, and a state rate of 5%).
4. The company also records payroll taxes at the same time as they record the payroll. Use the following rates: 6.2% and 1.45% for the FICA amounts, 5.4% and .8% for the unemployment taxes.
5. On May 16, Minute Services, Inc. issued a 60-day, 4% interest-bearing note with a face amount of $500,000 for the purchase of office equipment.
6. On the maturity date, Minute Services, Inc. paid the above note, in full.
7. On August 19, Fudd Chicken Company borrowed cash from the Bank of Smallsvile by issuing a 90-day, 6% discounted note with a face amount of $200,000.
8. On the maturity date, Fudd Chicken Company paid the above note, in full.

Review Questions:

1. Compare and contrast the following terms: borrower, debtor, creditor, lender.
2. Create a list that classifies different liabilities as either typically long-term or current:
3. Which liabilities would usually be the largest for a company?
4. As it relates to an interest-bearing note, write the formulas to calculate the following: 
• Interest =
• Maturity Value = 
5. Where is Interest Expense recorded on the Income Statement?
6. As it relates to discounted notes, write the formulas to calculate the following:
• Proceeds =
• Discount =
• Maturity Value =
7. Describe the primary differences between an interest-bearing note and a discounted note:
8. Identify the most likely classification of the following accounts: (the first three are done for you; be specific in your answer)
• cash: current asset
• land: long-term asset
• rent expense: operating expense
• note payable:
• mortgage payable:
• interest expense:
9. Use T-accounts or journal entries to illustrate the transactions needed to issue and then pay an interest-bearing note payable for cash:
10. Using T-accounts or journal entries, illustrate the transactions needed to issue and pay a discounted note payable for cash:
11. Why is accurate and timely payroll accounting so important?
12. What items are included in gross pay and how are they calculated?
13. What are the rules associated with overtime pay?
14. What is the formula for calculating net pay?
15. List and describe the different forms used in a payroll system:
16. List and describe the different required (statutory) deductions, including calculations, limits, requirements, and origin if applicable:
17. List and describe various voluntary deductions:
18. List and describe the different employer payroll taxes, including calculations, purpose, and procedures if applicable:

Day 149: Study Day

Prepare the journal entry for the following transactions:

1. On June 2, Biggersly Services, Inc. issued a 60-day, 4% interest-bearing note with a face amount of $20,000 for the purchase of office equipment.
2. On the maturity date, Biggersly Services, Inc. paid the above note, in full.
3. On May 1, Rotini Popcorn Company borrowed cash from the Bank of Venutia by issuing a 90-day, 6% discounted note with a face amount of $100,000.
4. On the maturity date, Rotini Popcorn Company paid the above note, in full.
5. On May 2, Smallsley Services, Inc. issued a 60-day, 4% interest-bearing note with a face amount of $100,000 for the purchase of office equipment.
6. On the maturity date, Smallsley Services, Inc. paid the above note, in full.
7. On July 11, Laslo Candy Company borrowed cash from the Bank of Venutia by issuing a 90-day, 6% discounted note with a face amount of $20,000.
8. On the maturity date, Laslo Candy Company paid the above note, in full.

Day 148: Study Day

LINK: Chapter 10 Review Questions

Day 147: Payroll Entries

Chapter 10 Review Questions

Chapter 10 Practice:

• page 499
• Exercises 3 & 4
• page 506
• Exercise EX 10-12
• page 507
• Exercise EX 10-13

Day 146: Payroll Taxes

Chapter 10 Review Question:

1. List and describe the different employer payroll taxes, including calculations, purpose, and procedures if applicable:

Chapter 10 Practice:

• page 503
• Basic Exercise BE 10-4
• page 506
• Exercise EX 10-11

Day 144: Payroll Deductions

Chapter 10 Review Questions:

1. List and describe the different required (statutory) deductions, including calculations, limits, requirements, and origin if applicable:
2. List and describe various voluntary deductions:

Chapter 10 Practice:

• page 498
• Multiple-choice Question 3
• page 505
• Exercise EX 10-9

Day 143: Gross Earnings

Chapter 10 Review Questions:

1. Why is accurate and timely payroll accounting so important?
2. What items are included in gross pay and how are they calculated?
3. What are the rules associated with overtime pay?
4. What is the formula for calculating net pay?
5. List and describe the different forms used in a payroll system:

Chapter 10 Practice:

• page 498
• Multiple-choice #2
• Exercise 2
• page 503
• Basic Exercise  BE 10-2
• page 505
• Exercise EX 10-8