S 11-5 (5-10 min.) 1. These are liabilities because at the time of the note Harley-Davidson, Inc. was contingent not liable for any of these product losses because they had not yet occurred. 2. The contingency can become a real liability if the user of a Harley-Davidson product suffers a loss for which the company is responsible. Harley-Davidson must pay for all losses up to $3 million and all losses above $25 million per claim. The company is insured against losses for individual claims between $3 million and $25 million—for these losses, the company would pay the deductible amount specified in its insurance policy. S 11-6 (10 min.) 1. Straight-time pay for 40 hours $840.00 Overtime pay for 10 hours: [10($840/401.5)] 315.00 Total pay $1,155.00 2. Total pay $1,155.00 Less: Withheld income tax ($1,1550.20) $231.00 Withheld CPP ($1,1550.0495) 57.17 Withheld EI ($1,1550.0183) 21.14 309.31 Net pay $845.69 S 11-7 (10 min.) Straight-time pay for 40 hours $ 840.00 Overtime pay for 10 hours: [10(840/40 315.00 1.5)] Total pay to employee 1,155.00 Employer payroll expenses: CPP expense ($57.17 from S11-6) 57.17 EI expense (1.4 S11-6) 29.60 $from Pension ($1,1550.05) 57.75 Provincial health insurance ($60 / 4) 15.00 Disability insurance ($8 / 4) 2.00 161.52 Total expense of employer $ 1,316.52
(5-10 min.) S 11-5 1. These are contingent liabilities because at the time of the note Harley-Davidson, Inc. was not liable for any of these product losses because they had not yet occurred. 2. The contingency can become a real liability if the user of a Harley-Davidson product suffers a loss for which the company is responsible. Harley-Davidson must pay for all losses up to $3 million and all losses above $25 million per claim. The company is insured against losses for individual claims between $3 million and $25 million—for these losses, the company would pay the deductible amount specified in its insurance policy. (10 min.) S 11-6 1. Straight-time pay for 40 hours $840.00 Overtime pay for 10 hours: [10($840/401.5)] 315.00 Total pay $1,155.00 2. Total pay $1,155.00 Less: Withheld income tax ($1,1550.20) $231.00 Withheld CPP ($1,1550.0495) 57.17 Withheld EI ($1,1550.0183) 21.14 309.31 Net pay $845.69 (10 min.) S 11-7 Straight-time pay for 40 hours $ 840.00 Overtime pay for 10 hours: [10(840/40 1.5)] 315.00 Total pay to employee 1,155.00 Employer payroll expenses: CPP expense ($57.17 from S11-6) 57.17 EI expense (1.4 $from S11-6) 29.60 Pension ($1,1550.05) 57.75 Provincial health insurance ($60 / 4) 15.00 Disability insurance ($8 / 4) 2.00 161.52 Total expense of employer $ 1,316.52
Accounting-9th-Canadian-Edition-Volume-2-Solution.docx