The following information about the payroll for the week ended December 30 was o
ID: 2785524 • Letter: T
Question
The following information about the payroll for the week ended December 30 was obtained from the records of Boltz Co.: Salaries: Deductions: Sales salaries $330,000 Income tax withheld $116,600 Warehouse salaries 180,000 U.S. savings bonds 14,454 Office salaries 147,000 Group insurance 11,826 $657,000 Tax rates assumed: Social security 6% State unemployment (employer only) 5.4% Medicare 1.5% Federal unemployment (employer only) 0.8% Required: 1. Assuming that the payroll for the last week of the year is to be paid on December 31, journalize the following entries (refer to the Chart of Accounts for exact wording of account titles): a. December 30, to record the payroll. b. December 30, to record the employer’s payroll taxes on the payroll to be paid on December 31. Of the total payroll for the last week of the year, $31,000 is subject to unemployment compensation taxes. 2. Assuming that the payroll for the last week of the year is to be paid on January 5 of the following fiscal year, journalize the following entries (refer to the Chart of Accounts for exact wording of account titles): On page 11 of the journal: December 30, to record the payroll. On page 12 of the journal: January 5, to record the employer's payroll taxes on the payroll to be paid on January 5. Since it is a new fiscal year, all $657,000 in salaries is subject to unemployment compensation taxes. Scroll down to access additional pages of the journal. 1. Assuming that the payroll for the last week of the year is to be paid on December 31, journalize the following entries (refer to the Chart of Accounts for exact wording of account titles): a. December 30, to record the payroll. b. December 30, to record the employer's payroll taxes on the payroll to be paid on December 31. Of the total payroll for the last week of the year, $31,000 is subject to unemployment compensation taxes. PAGE 11 JOURNALACCOUNTING EQUATION DATE DESCRIPTION POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 2 3 4 5 6 7 8 9 10 11 12 13 14 2. Assuming that the payroll for the last week of the year is to be paid on January 5 of the following fiscal year, journalize the following entries (refer to the Chart of Accounts for exact wording of account titles): a. On page 11 of the journal: December 30, to record the payroll. b. On page 12 of the journal: January 5, to record the employer’s payroll taxes on the payroll to be paid on January 5. Since it is a new fiscal year, all $657,000 in salaries is subject to unemployment compensation taxes. PAGE 11 JOURNALACCOUNTING EQUATION DATE DESCRIPTION POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 2 3 4 5 6 7 8 9 PAGE 12 JOURNALACCOUNTING EQUATION DATE DESCRIPTION POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 2 3 4 5
Explanation / Answer
1. a. Dec. 30 Sales Salaries Expense.......................................... 330,000
Warehouse Salaries Expense............................... 180,000
Office Salaries Expense........................................ 147,000
Employees Income Tax Payable.................... 116,600
Bond Deductions Payable.............................. 14,454
Group Insurance Payable.............................. 11,826
Salaries Payable.............................................. 514,120
b. Dec. 30 Payroll Tax Expense............................................. 4,247
Social Security Tax Payable........................... 1,8601
Medicare tax Payable……………………….. 4652
State Unemployment Tax Payable................ 1,6743
Federal Unemployment Tax Payable............ 2484
131,000 x 6%
231,000 x 1.5%
3$31,000 × 5.4%
4$31,000 × 0.8%
2. a. Dec. 30 Sales Salaries Expense.......................................... 330,000
Warehouse Salaries Expense............................... 180,000
Office Salaries Expense........................................ 147,000
Employees Income Tax Payable.................... 116,600
Social Security Tax Payable........................... 39,4203
Medicare Tax Payable.................................... 9,8554
Bond Deductions Payable.............................. 14,454
Group Insurance Payable.............................. 11,826
Salaries Payable.............................................. 464,845
3$657,000 × 6%
4$657,000 × 1.5%
b. Jan. 5 Payroll Tax Expense............................................. 90,009
Social Security Tax Payable........................... 39,420
Medicare Tax Payable.................................... 9,855
State Unemployment Tax Payable................ 35,4785
Federal Unemployment Tax Payable............ 5,2566
5$657,000 × 5.4%
6$657,000 × 0.8%
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