Problem V Salaries (all subject to social security and Medicare taxes) Federal I

Question

Problem V Salaries (all subject to social security and Medicare taxes) Federal Income taxes withheld State and Local taxes withheld Medical Insurance deduction Life Insuranced Union Dues Salaries subject to unemployment taxes Medicare tax rate Social security tax rate FUTA rate SUTA rate 15,000 1,300 1,000 200 400 100 13,000 1.45% 6.2% 0.6% 5.4% Note: Medical And Life insurance are 100% paid for by the employee. Required: 1) Prepare the journal entry to record the payroll expense for the month. 2) Prepare the journal entry to record the employer's payroll tax expense. 3) Prepare the journal entries/entry to pay all the bills.

Explanation / Answer

a) Salaries expense 15000             Federal income tax payable 1300             State income tax payable 1000              Medical insurance payable 200              Life insurance payable 400              Union dues payable 100              Social security tax payable 930 (15000*6.2%)              Medicare payable 217.5 (15000*1.45%)              Salaries payable 10852.5 b) Payroll tax expese 1927.5              Social security tax payable 930 (15000*6.2%)              Medicare payable 217.5 (15000*1.45%)              FUTA payable 78 (13000*.6%)              SUTA payable 702 (13000*5.4%) c) Salaries payable 10852.5             Cash 10852.5 d) Federal income tax payable 1300 State income tax payable 1000 Medical insurance payable 200 Life insurance payable 400 Union dues payable 100 Social security tax payable 1860 Medicare payable 435 FUTA payable 78 SUTA payable 702                  Cash 6075

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