Question

On January 15, the end of the first biweekly pay period of the year, North Company's payroll register showed that its employees earned $28,000 of sales salaries. Withholdings from the employees' salaries include FICA Social Security taxes at the rate of 6.2% FICA Medicare taxes at the rate of 1.45%, $3,800 of federal income taxes, $678 of medical insurance deductions, and $190 of union dues. No employee earned more than $7,000 in this first period. Prepare the journal entry to record North Company's January 15 (employee) payroll expenses and liabilities.

Answer 1

Ans: Employee payroll for the period

Date	Account title and explanation	Debit	Credit
	Sales Salary expense	$28,000
	FICA social security tax		$1,736
	FICA medicare tax		$406
	Federal income tax		$3,800
	Medical insurance deduction		$678
	Union dues		$190
	Sales salaries payable		$21,190
	( to record employee payroll)

FICA social security tax= $28,000*6.2%

= $1,736

FICA medicare tax= $28,000*1.45%

= $ 406