Lightning Electronics is a midsize manufacturer of lithium batteries. The compan

Question

Lightning Electronics is a midsize manufacturer of lithium batteries. The company’s payroll records for the November 1–14 pay period show that employees earned wages totaling $71,000 but that employee income taxes totaling $11,200 and FICA taxes totaling $3,675 were withheld from this amount. The net pay was directly deposited into the employees’ bank accounts. Assume Lightning Electronics must also pay $460 of unemployment taxes for this pay period. Prepare the journal entry or entries that Lightning would use to record the payroll. Include both employee and employer taxes. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

Explanation / Answer

Journal Entries Date Account Title & explanation Debit Credit 'November 15 Salaries expenses 71000 FICA Tax payable 3675 Federal Income Tax withholding payable 11200 Net Payroll payable 56125 (Salaries and withholdings for the work period November 1-14 period recorded) 'November 15 Unemployment tax - expense 460 Unemployment tax payable 460 (Unemployment tax expense for the work period November 1-14 period recorded) 'November 15 Net Payroll payable 56125 Cash 56125 (distribution of salaries checks on November 15) 'November 15 FICA Tax payable 3675 Federal Income Tax withholding payable 11200 Unemployment tax payable 460 Cash 15335 (remittance of withholding taxes and other payroll expenses for the period Nov 1-14)

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