Question

Francisco Company has 10 employees, each of whom earns $2,600 per month and is paid on the last day of each month. All 10 have been employed continuously at this amount since January 1. On March 1, the following accounts and balances exist in its general ledger.

1. FICA—Social Security Taxes Payable, $3,224; FICA—Medicare Taxes Payable, $754. (The balances of these accounts represent total liabilities for both the employer's and employees' FICA taxes for the February payroll only.)
2. Employees' Federal Income Taxes Payable, $6,500 (liability for February only).
3. Federal Unemployment Taxes Payable, $312 (liability for January and February together).
4. State Unemployment Taxes Payable, $2,808 (liability for January and February together).

The company had the following payroll transactions.

Mar.		15		Issued check payable to Swift Bank, a federal depository bank authorized to accept employers' payments of FICA taxes and employee income tax withholdings. The $10,478 check is in payment of the February FICA and employee income taxes.
		31		Recorded the journal entry for the March salaries payable. Then recorded the cash payment of the March payroll (the company issued checks payable to each employee in payment of the March payroll). The payroll register shows the following summary totals for the March pay period.

Salaries
Office Salaries			Shop Salaries		Gross Pay		FICA Taxes*		Federal Income Taxes		Net Pay
	$	10,400	$	15,600	$	26,000	$	1,612	$	6,500	$	17,511
							$	377

* FICA taxes are Social Security and Medicare, respectively.

		31		Recorded the employer's payroll taxes resulting from the March payroll. The company has a state unemployment tax rate of 5.40% on the first $7,000 paid to each employee. The federal rate is 0.60%.
Apr.		15		Issued check to Swift Bank in payment of the March FICA and employee income taxes.
		15		Issued check to the State Tax Commission for the January, February, and March state unemployment taxes. Filed the check and the first-quarter tax return with the Commission.
		30		Issued check payable to Swift Bank in payment of the employer's FUTA taxes for the first quarter of the year.
		30		Filed Form 941 with the IRS, reporting the FICA taxes and the employees' federal income tax withholdings for the first quarter.

Required:
Prepare journal entries to record these transactions and events. (If no entry is required for a particular transaction, select "No journal entry required" in the first account field.)

Answer 1

credit $10,478 $1,612 4371 $6,500 $17.511 $17511 17,511 $ 17,511 Answer Journal entries TL Debit Date particulars Mar-15 FICA Social security Taxis payable Year $ 3,224 FICA Hedi cate Taxes payable de DN $ 754 Employee federal Tex payable Ale DY $6,500 To cash Being payment of Fict and employee federal Tax payable] Mar-21 office salaries expeu des Me $10.400 shop wages expence A/C 415,600 TO FICA Social Sec. Tax payable TO FICA Hedi care Tax payable TO Employee federal Tax payabil To Accrued wages payable Being employee payroll for period Mar-B1 cash payroll bank ale or $17511 To casla Being Transfer cash to payroll bankaccat Accrued wages payable ale or To cash payroll bank account [being payment & payroll Maral payroll Takes expenses Ale OY $3,069 TO FIC A Social see Tax payable TO FIC Medicase Tax payable To state unemployment Taxes -$2,600 x2))x107x susayable To federal unemployment ter pogado 47000-62,600x2]10*0.602 feing employer payroll taxes? Apr-15 FICA-social sec. Taxe payable Ale or $3,224 FICA- Medicare tax payable Ale or $754 Employee federal Tax payable Ale or $6,500 To cash Being payment of FICA and federal Птах payable) Apr-xs state unemployment taxes payable Afe. DY 13780 - To cash f2,808 + $9727 I freing payment of suta taxes] Apred federal unemployment Tax payable Alon $420 1. To cash ($318+ $108] Being payment of FUTA tazes] Apr-30 No entry required upon mailing formal $1,612 $377 $979 $ 108 $10,478 $ 3780 42.760 $490