Mann Hardware has four employees who are paid on an hourly basis plus time-and-a
ID: 2588894 • Letter: M
Question
Mann Hardware has four employees who are paid on an hourly basis plus time-and-a-half for all hours worked in excess of 40 a week. Payroll data for the week ended March 15, 2017, are presented below.
Employee
Hours Worked
Hourly Rate
Federal Income Tax Withholdings
United Fund
Ben Abel
40 $15.00 $? $5.00
Rita Hager
42 16.00 ? 5.00
Jack Never
44 13.00 60.00 8.00
Sue Perez
46 13.00 61.00 5.00
Abel and Hager are married. They claim 0 and 4 withholding allowances, respectively. The following tax rates are applicable: FICA 7.65%, state income taxes 3%, state unemployment taxes 5.4%, and federal unemployment 0.8%.
Prepare a payroll register for the weekly payroll. (Round answers to 2 decimal places, e.g. 15.25.)
MANN HARDWARE
Payroll Register
For the Week Ending March 15, 2017
Earnings
Deductions
Employee
Hours
Regular
Overtime
Gross Pay
FICA
Federal Income Tax
State Income Tax
United Fund
Total
Net Pay
Salaries and Wages Expense
Ben Abel
40
$
$
$
$
$
$
$
$
$
$
Rita Hager
42
Jack Never
44
Sue Perez
46
Totals
$
$
$
$
$
$
$
$
$
$
SHOW LIST OF ACCOUNTS
Journalize the payroll on March 15, 2017, and the accrual of employer payroll taxes. (Round answers to 2 decimal places, e.g. 15.25. Credit account titles are automatically indented when amount is entered. Do not indent manually.)
Date
Account Titles and Explanation
Debit
Credit
Mar. 15
(To record payroll)
Mar. 15
(To record accrual of payroll taxes.)
SHOW LIST OF ACCOUNTS
Journalize the payment of the payroll on March 16, 2017. (Round answers to 2 decimal places, e.g. 15.25. Credit account titles are automatically indented when amount is entered. Do not indent manually.)
Date
Account Titles and Explanation
Debit
Credit
Mar. 16
SHOW LIST OF ACCOUNTS
Journalize the deposit in a Federal Reserve bank on March 31, 2017, of the FICA and federal income taxes payable to the government. (Round answers to 2 decimal places, e.g. 15.25. Credit account titles are automatically indented when amount is entered. Do not indent manually.)
Date
Account Titles and Explanation
Debit
Credit
Mar. 31
SHOW LIST OF ACCOUNTS
Explanation / Answer
Ben abel Hours Rate Pay Gross pay: Regular earnings 40 40 1600 Overtime earnings Total gross pay 1600 Federal tax withholding calculation Gross pay 1600 Less: Withholding allowance Number of allowances 0 Amount of allowance 77.9 Total withholding allowance 0 0 Amount subject to tax 1600 Federal tax withholding: a Base tax 35.9 Employee amount subject to tax 1600 Less: 525 Amount subject to tax@ 15% 1075 b Tax @ 15% 161.25 c=a+b Total tax withholding 197.15 Gross pay 1600 Withholding: Rate Tax base Tax amount State income tax@ 3% 1600 48 FICA@ 7.65% 1600 122.4 State unemployement tax@ 5.40% 1600 86.4 Union fund 5 Federal income tax 197.15 Total withholding 458.95 Net pay 1141.05 Rita hager Hours Rate Pay Gross pay: Regular earnings 40 40 1600 Overtime earnings 2 60 120 Total gross pay 1720 Federal tax withholding calculation Gross pay 1720 Less: Withholding allowance Number of allowances 4 Amount of allowance 77.9 Total withholding allowance 311.6 -311.6 Amount subject to tax 1408.4 Federal tax withholding: a Base tax 35.9 Employee amount subject to tax 1408.4 Less: 525 Amount subject to tax@ 15% 883.4 b Tax @ 15% 247.352 c=a+b Total tax withholding 283.252 Gross pay 1720 Withholding: Rate Tax base Tax amount State income tax@ 3% 1720 51.6 FICA@ 7.65% 1720 131.58 State unemployement tax@ 5.40% 1720 92.88 Union fund 5 Federal income tax 283.252 Total withholding 564.312 Net pay 1155.688 Jack never Hours Rate Pay Gross pay: Regular earnings 40 13 520 Overtime earnings 4 19.5 78 Total gross pay 598 Gross pay 598 Withholding: Rate Tax base Tax amount State income tax@ 3% 598 17.94 FICA@ 7.65% 598 45.75 State unemployement tax@ 5.40% 598 32.29 Union fund 8.00 Federal income tax 60.00 Total withholding 163.98 Net pay 434.02 Sue perez Hours Rate Pay Gross pay: Regular earnings 40 13 520 Overtime earnings 6 19.5 117 Total gross pay 637 Gross pay 637 Withholding: Rate Tax base Tax amount State income tax@ 3% 637 19.11 FICA@ 7.65% 637 48.73 State unemployement tax@ 5.40% 637 34.40 Union fund 5.00 Federal income tax 61.00 Total withholding 168.24 Net pay 468.76 Summary: Employee Sue perez Jack never Rita hager Ben abel Total Gross wages 637.00 598.00 1,720.00 1,600.00 4,555.00 Deductions: 3% State income tax 19.11 17.94 51.60 48.00 136.65 7.65% FICA 48.73 45.75 131.58 122.40 348.46 5.40% State unemployement tax 34.40 32.29 92.88 86.40 245.97 Union fund 5.00 8.00 5.00 5.00 23.00 Federal income tax 61.00 60.00 283.25 197.15 601.40 Total withholding 168.24 163.98 564.31 458.95 1,355.48 Net pay 468.76 434.02 1,155.69 1,141.05 3,199.52 Journal Date Account Debit Credit Mar.15 Salaries and wages expense 4,555.00 State income tax payable 136.65 FICA payable 348.46 State unemployement tax payable 245.97 Union fund payable 23.00 Federal income tax payable 601.40 Salaries and wages payable 3,199.52 [Weekly wage expense] Mar.16 Salaries and wages payable 3,199.52 Bank 3,199.52 [Salaries and wages paid] Mar.31 FICA payable 348.46 Federal income tax payable 601.40 Bank 949.86 [Fica and federal taxed deposited]
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