Question

Plymouth Electronics had the following transactions that produced liabilities during 2020: Purchased merchandise on credit for $80,000. (Note: Assume a periodic inventory system.) Year-end wages of $40,000 were incurred, but not paid. Related federal income taxes of $13,000 and Medicare taxes of $580 were withheld. Employee wages are all above the Social Security maximum, so only Medicare was paid. Year-end estimated income taxes payable, but unpaid, for the year were $113,615. Sold merchandise on account for $3,636, including state sales taxes of $180. (Note: Assume a periodic inventory system.) Employer's share of Medicare taxes for the period was $580. The taxes will be paid at a later date. Borrowed cash under a 180-day, 8%, $155,000 note. Required: Prepare the entry to record each of these transactions (treat each transaction independently). If an amount box does not require an entry, leave it blank

Answer 1