Question

E10-3 Recording Payroll Costs [LO 10-2] McLoyd Company completed the salaries and wages payroll for March. The payroll provided the following details: $430,000 Salaries and wages earned Employee income taxes withheld FICA taxes withheld Unemployment taxes 39,775 30,745 2,990 Required: 1. Considering both employee and employer payroll taxes, use the preceding information to calculate the total labor cost for the company for March 2. & 3. Prepare the journal entry to record the payroll for March, including employee deductions (but excluding employer payroll taxes) and record employer's FICA taxes and unemployment taxes. Employees were paid in March but amounts withheld were not yet remitted. Complete this question by entering your answers in the tabs below. Req 1 Req 2 and 3 Considering both employee and employer payroll taxes, use the preceding information to calculate the total labor cost for the company for March. Total Labor Cost POD Req 2 and 3 >

Answer 1

1) Find the total labor cost as follows: Salaries and wages FICA taxes Unemployment taxes Total Labor cost $430,000 $30,743 $2,990 $463,735 2) Prepare journal entry for Payroll for March as follows: Date Account title and Explanation Amount Amount 31-Mar Salaries and Wages Expense $430,000 Income Taxes withheld $39,775 FICA Taxes withheld $30,745 Cash ($430,000-$39.775-$30,745) $359,480 (To record Payroll for March) 3) Prepare journal entry for Payroll tax expenses for March as follows: Date Account title and Explanation Amount Amount 31-Mar Payroll tax expense $33,735 FICA Taxes Payable $30,743 Unemployment taxes payable $2,990 (To record Payroll tax expenses for March)