Question

Entries for Payroll and Payroll Taxes The following information about the payroll for the week ended December 30 was obtained from the records of Baltz Co.: Salaries: Sales salaries Deductions: Income tax withheld U.S. savings bonds Group insurance $197,000 108,000 100,000 $405,000 Warehouse salaries $71,280 8,910 7,290 Office salaries Tax rates assured: Social security, 6% Medicare, 1.5% State unemployment (employer only), 5.4% Federal unemployment (employer only), 0.0% Required: If an amount box does not require an entry, leave it blank. la. Assuming that the payroll for the last week of the year is to be paid on December 31, joumalize the entry on December 30 to record the payroll. Account Debit Credit Date Dec 30 1b. Assuming that the payroll for the last week of the year is to be paid on December 31, joumalize the entry on 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, $20,000 is subject to unemployment compensation taxes. Date Credit Dec. 30 Za. Assuming that the payroll for the last week of the year is to be paid on January 5 of the following fiscal yearjournalize the entry on December 30 to record the payroll. Date Account Debit Credit Dec. 30 zb. 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 entry to record the employer's payroll taxes on the payroll to be paid on January 5. Because it is a new fiscal year all $405,000 in salaries is subject to unemployment compensation taxes. Account Debit Credit Date jan. 5

Answer 1

1a.
Date	Account	Debit	Credit
Dec. 30	Sales Salaries Expense	$197,000
	Warehouse Salaries Expense	$108,000
	Office Salaries Expense	$100,000
	Social Security tax payable     [$405,000 x 6%]		$24,300
	Medicare tax payable               [$405,000 x 1.50%]		$6,075
	Bond Deduction Payable		$8,910
	Group Insurance Payable		$7,290
	Employees Income taxes payable		$71,280
	Salaries Payable       [Gross salaries - Total deductions = $405,000 - ($24,300 + $6,075 + $8,910 + $7,290 + $71,280)]		$287,145
	(To record the salary expense)
1b.
Dec. 30	Payroll tax Expense                                        [$24,300 + $6,075 + $1,080 + $160]	$31,615
	Social Security tax payable     [$405,000 x 6%]		$24,300
	Medicare tax payable               [$405,000 x 1.50%]		$6,075
	State Unemployment Tax Payable		$1,080
	Federal Unemployment Tax Payable		$160
	(To record the payroll tax expense)
2a.
Date	Account	Debit	Credit
Dec. 30	Sales Salaries Expense	$197,000
	Warehouse Salaries Expense	$108,000
	Office Salaries Expense	$100,000
	Social Security tax payable     [$405,000 x 6%]		$24,300
	Medicare tax payable               [$405,000 x 1.50%]		$6,075
	Bond Deduction Payable		$8,910
	Group Insurance Payable		$7,290
	Employees Income taxes payable		$71,280
	Salaries Payable       [Gross salaries - Total deductions = $405,000 - ($24,300 + $6,075 + $8,910 + $7,290 + $71,280)]		$287,145
	(To record the salary expense)
2b.
Jan. 5	Payroll tax Expense                                        [$24,300 + $6,075 + $21,870 + $3,240]	$55,485
	Social Security tax payable     [$405,000 x 6%]		$24,300
	Medicare tax payable               [$405,000 x 1.50%]		$6,075
	State Unemployment Tax Payable         [$405,000 x 5.4%]		$21,870
	Federal Unemployment Tax Payable     [$405,000 x 0.8%]		$3,240
	(To record the payroll tax expense)