3. Shelby Company has one employee who earned wages $3,540 this week. Additional
ID: 2593932 • Letter: 3
Question
3. Shelby Company has one employee who earned wages $3,540 this week. Additional information is: FICA tax OASDI FICA tax HI Federal income tax ............... $445 per pay State income tax 20% of the federal income tax withholding Federal unemployment tax 0.6% on first S7.000 Employer state unemployment tax 3.5% on first S 14,000 401(k) plan deduction Child support garnishment$100 per pay Health insurance premium $110 per pay Cumulative wages to date (before this pay) is $13,500. 6.2% on first $118,500 1.45% on total gross pay 3% per pay INSTRUCTIONS: Use the form on the next page to: 1) Record the payroll entry for the hourly employee: (Employee is paid on May 15.) 2) Record the payroll tax entry for May 15. soneral Journal for Problem 3 Post Ref Debit Credit Date DescriptionExplanation / Answer
Calculation of Tax and other deductions
FICA Tax OASDI not applicable
FICA Tax HI = 1.45% 0F 3540
$51.33
Federal income tax
445.00
state income tax 20% of 445
89.00
Federal unemployment tax - not applicable
Employer state unemployment tax 3.5% * 14000
490
Total Tax
1075.33
Other deductions
401 (K) plan deduction 3% of 3540
106.20
Child support garnishment
100
Health insurance premium
110
Total other deduction
316.20
Total deduction
1391.53
Payroll entry
Accounts Titles and explanation
Debit dollar
Credit dollar
Salary A/C
$3540
Employee
( Being salary provided in books)
$3540
Payment made
$3540
Employee A/C
Bank A/C
2148.47
FICA Tax HI A/C
51.33
Federal income tax A/C
445
state income tax A/C
89
Employer state unemployment tax A/C
490
401 (K) plan deduction 3% of 3540
106.20
Child support garnishment
100
Health insurance premium
( Being salary paid to employee)
110
FICA Tax OASDI not applicable
FICA Tax HI = 1.45% 0F 3540
$51.33
Federal income tax
445.00
state income tax 20% of 445
89.00
Federal unemployment tax - not applicable
Employer state unemployment tax 3.5% * 14000
490
Total Tax
1075.33
Other deductions
401 (K) plan deduction 3% of 3540
106.20
Child support garnishment
100
Health insurance premium
110
Total other deduction
316.20
Total deduction
1391.53
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