Required information Use the following information for the Exercises below. [The
ID: 2526178 • Letter: R
Question
Required information
Use the following information for the Exercises below.
[The following information applies to the questions displayed below.]
BMX Company has one employee. FICA Social Security taxes are 6.2% of the first $118,500 paid to its employee, and FICA Medicare taxes are 1.45% of gross pay. For BMX, its FUTA taxes are 0.6% and SUTA taxes are 2.9% of the first $7,000 paid to its employee.
Exercise 11-6 Payroll-related journal entries LO P2
Assuming situation a, prepare the employer’s September 30 journal entries to record salary expense and its related payroll liabilities for this employee. The employee’s federal income taxes withheld by the employer are $60 for this pay period. (Round your answers to 2 decimal places.)
Gross Pay through August Gross Pay for September a. $ 6,400 $ 1,700 b. 20,100 4,000 c. 114,100 9,900Explanation / Answer
(a) Tax September Earnings Subject to Tax Tax Rate Tax Amount Explanation FICA-Social Security 1700 6.20% $ 105.40 Full amount is subject to Tax FICA-Medicare 1700 1.45% $ 24.65 Full amount is subject to Tax FUTA 600 0.60% $ 3.60 $1100 is over the maximum $7000 SUTA 600 2.90% $ 17.40 $1100 is over the maximum $7000 Total Payroll Taxes Expense $ 151.05 Date General Journal Debit Credit Sep 30 Salary Expense $ 1,700.00 FICA—Social sec. taxes payable $ 105.40 FICA—Medicare taxes payable $ 24.65 Federal Income tax payable $ 60.00 Salary Payable $ 1,509.95 (For Employer Part only) Sep 30 Payroll taxes expense $ 151.05 FICA—Social sec. taxes payable $ 105.40 FICA—Medicare taxes payable $ 24.65 Federal unemployment taxes payable $ 3.60 State unemployment taxes payable $ 17.40
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