Question

The following monthly data are taken from Ramirez Company at July 31: Sales salaries, $200,000; Office salaries, $160,000; Federal income taxes withheld, $90,000; State income taxes withheld, $20,000; Social security taxes withheld, $22,320; Medicare taxes withheld, $5,220; Medical insurance premiums, $7,000, Life insurance premiums, $4,000; Union dues deducted, $1,000; and Salaries subject to unemployment taxes, $50,000. The employee pays 40% of medical and life insurance premiums Assume that FICA taxes are identical to those on employees and that SUTA taxes are 5.4% and FUTA taxes are 06%. 1&2. Using the above information, complete the below table and Prepare the journal entries to record accrued payroll and cash payment of the net payroll for July. 3. Using the above information, complete the below table 4. Record the accrued employer payroll taxes and all other employer-paid expenses and the cash payment of all liabilities for July- assume that FICA taxes are identical to those on employees and that SUTA taxes are 5.4% and FUTA taxes are 0.6% Complete this question by entering your answers in the tabs below. Req 1 and 2 Req 3 Req 4 Record the accrued employer payroll taxes and all other employer-paid expenses and the cash payment of all liabilities for July-assume that FICA taxes are identical to those on employees and that SUTA taxes are 5.4% and FUTA taxes are 0.6% View transaction list

Answer 1

Transaction	account titles and explanation	debit	credit
1	sales Salaries expense	200000
	Office Salaries expense	160000
	Social Security tax payable		22320
	Medicare tax payable		5220
	Employee federal income tax payable		90000
	Employee state income tax payable		20000
	Employee medical insurance premium payable (7000*40%)		2800
	Employee life insurance premium payable (4000*40%)		1600
	Employee union dues payable		1000
	Salaries payable (balancing figure)		217060
2.	Salaries payable	217060
	Cash		217060
3.	payroll tax expense	37140
	Social Security tax payable		22320
	Medicare tax payable		5220
	State unemployment tax payable (50000*5.40%)		2700
	Federal unemployment tax payable (50000*0.6%)		300
	Employee medical insurance premium payable (7000*60%)		4200
	Employee life insurance premium payable (4000*60%)		2400
4.	social security tax payable (22320+22320)	44640
	Medicare tax payable (5220+5220)	10440
	Employee federal income tax payable	90000
	Employee state income tax payable	20000
	Employee medical insurance payable	7000
	Employee life insurance payable	4000
	Employee union dues payable	1000
	State unemployment tax payable	2700
	Federal unemployment tax payable	300
	Cash		180080