1. Harper Company receives a 6% interest bearing note from Mastro Company on November 1st to settle a $20,000 account receivable. The note matures in six months. At December 31, Harper should record interest revenue of
a. $0
b. $100
c. $200
d. $600
2. Which of the following is generally classified as a current liability?
a. Two-year notes payable.
b. Bonds Payable.
c. Mortgage payable.
d. Unearned Rent.
3. Which of the following taxes would be subtracted in calculating an employee's net pay?
a. FUTA taxes
b. SUTA taxes
c. FICA taxes
d. all of the above
4. Sarah Lucky is paid $25 per hour, with time and a half for all hours worked in excess of 40 during a week. The following is Sarah’s payroll data for the current week: hours worked, 46; federal income tax withheld, $350; cumulative earnings for year prior to current week, $99,700; social security tax rate, 6.0% on maximum of $100,000; and Medicare tax rate, 1.5% on all earnings. What is Sarah’s net pay?
a. $875.00
b. $838.62
c. $857.00
d. $1133.14
5. Anton Company issued an $80,000, 6%, 120-day note payable to Bailey Company on June 8th. What is the due date of the note?
a. October 8
b. October 7
c. October 6
d. October 5
6. On March 1, 2014, Baxter Industries borrowed $40,000 by signing a 30 day, 6% interest bearing note. When the note is paid on March 31, the entry to record the payment should include a
a. debit to Interest Payable $200
b. debit to Interest Expense $200
c. credit to Cash for $40,000
d. credit to Cash for $42400