Answer:
See the explanation for the answer.
Explanation:
The required journal entries will be prepared as follows:
1 & 2
i. To record payroll on December 31.
Date General Journal Debit Credit
Dec. 31 Salaries and Wages Expense 80000
Withheld Income Taxes Payable 8000
FICA Taxes Payable 6000
Contribution to American 3000
Cancer Society
Cash 63000
Dec. 31 Payroll Tax Expense 6600
FICA Taxes Payable 6000
State and Federal Unemployment 600
Taxes Payable
ii. To record collection of rent on December 10.
Date General Journal Debit Credit
Dec. 10 Cash 6000
Unearned Rent Revenue 6000
iii. Adjusting entry on December 31.
Date General Journal Debit Credit
Dec. 31 Unearned Rent Revenue 4000
Rent Revenue 4000
3.
The liabilities should be reported in the balance sheet as follows:
L COMPANY
Balance Sheet (Partial)
At December 31
Current Liabilities:
Income Taxes Payable 8000
FICA Taxes Payable 12000
Contribution to American Cancer Society 3000
State and Federal Unemployment Taxes Payable 600
Unearned Rent Revenue 2000
Total current liabilities 25600
