Question

Payroll entries Instructions Chart of Accounts Journal Instructions Urban Window Company had gross es of $300.000 during the week ended July 15. The amount of wages subject to social security tax was $300,000, while the amount of wages subject to federal and state unemployment taxes was $25,000. Tax rates are as follows: Social security Modicaro State unemployment Federal unemployment 6.0% 1.5% 5.4% 0.6% The total amount withheld from employee wages for federal taxes was $48.500 Required: A. Joumalize the entry to record the payroll for the week of July 15. B. Joumafro the entry to record the payroll tax expense incurred for the week of July 15. Refer to the Chart of Accounts for exact wording of account titles

Answer 1

Answers:

Answer A: Credit Calculations: Date July. 15 Debit $390,000 Account Title and explanation Salaries and wages Expense Social Security taxes Payable Medicare taxes Payable Federal withholding taxes Payable Salaries and wages Payable (to record payroll expense) = 390000 * 6% = 390000 * 1.5% $23,400 $5,850 $48,500 $312,250 Answer B: Credit Date July. 15 Debit $30,750 Account Title and explanation Payroll tax Expense Social Security taxes Payable Medicare taxes Payable State unemployment taxes Payable Federal unemployment taxes Payable (to record payroll tax expense) $23,400 $5,850 $1,350 =25000*5.4% =25000*0.6% $150