1. Swell Company has a lawsuit pending from a customer claiming damages of $100,000. Swell’s attorney advises that the likelihood the customer will win is remote. GAAP requires at a minimum that this contingent liability be
a. disclosed in the footnotes.
b. disclosed in the footnotes, with ranges of potential loss.
c. booked, as well as disclosed in the footnotes.
d. No disclosure is required.
2. An employee has year to date earnings of $105,000. The employee’s gross pay for the next pay period is $5,000. If the FICA wage base is $106,800, how much FICA tax will be withheld from the employee’s pay?
a. $184.10
b. $382.50
c. $310.00
d. $137.70
3. The employer is responsible for which of the following payroll taxes?
a. 6.2% Social Security
b. 1.45% Medicare tax
c. Federal and state unemployment taxes
d. All of the above