Question

Payroll Tax Entries According to a summary of the payroll of Mountain Streaming Co., $502,000 was subject to the 6.0% social security tax and the 1.5% Medicare tax. Also, $17,000 was subject to state and federal unemployment taxes. a. Calculate the employer's payroll taxes, using the following rates: state unemployment, 4.2%; federal unemployment, 0.8%. b. Journalize the entry to record the accrual of payroll taxes. If an amount box does not require an entry, leave it blank.

Answer 1

solution a) Employer's payroll Taxer Social Security Tax = Tax base y Tax rate 3 = 502000 X .0% 30120 Medicare Tax = 502000 X 1,5% = 7530

FUTA = Tax base y Tax rate 17000 X 0.8 % 136

SUTA = 17000 X 4.2% - hit Total amount = 30120 + 7520 + 136 + 714 - Obto8E Tournal entry " Account title Credit Deutt 38490 payroll Tax expense 30120 To 7520 To social security Tax payable Medicare tax payable federal unemployment tax To 136 - payable To state unemployment tax 714 payable