Question

On January 8, the end of the first weekly pay period of the year, Regis Company's employees earned $22,760 of office salaries and $70,840 of sales salaries. Withholdings from the employees' salaries include FICA Social Security taxes at the rate of 6.2%, FICA Medicare taxes at the rate of 1.45%, $12,760 of federal income taxes, $1,360 of medical insurance deductions, and $800 of union dues. No employee earned more than $7,000 in this first period. Required: 1.1 Calculate below the amounts for each of these four taxes of Regis Company. Regis's state unemployment tax rate is 5.4% of the first $7,000 paid to each employee. The federal unemployment tax rate is 0.6%. 1.2 Prepare the journal entry to record Regis Company's January 8 employee payroll expenses and liabilities. 2. Prepare the journal entry to record Regis's employer payroll taxes resulting from the January 8 payroll. Regis's state unemployment tax rate is 5.4% of the first $7,000 paid to each employee. The federal unemployment tax rate is 0.6%. Complete this question by entering your answers in the tabs below. Req 1A Reg 1B Req 2

Answer 1

January 8 earnings subject to tax = Gross Salaries = Office Salaries + Sales Salaries = $22,760 + $70,840			$93,600
Tax	January 8 earnings subject to tax (a)	Tax Rate (b)	Tax Amount (a x b)
FICA - Social Security	$93,600	6.20%	$5,803.20
FICA - Medicare	$93,600	1.45%	$1,357.20
SUTA	$93,600	5.40%	$5,054.40
FUTA	$93,600	0.60%	$561.60

.

.

1.2 Entry to record the employee payroll expense and liabilities
Date	General Journal	Debit	Credit
Jan. 08	Office Salaries Expense	$22,760.00
	Salaries Salaries Expense	$70,840.00
	FICA - Social Sec. Taxes payable		$5,803.20
	FICA - Medicare Taxes payable		$1,357.20
	Employee Fed. Inc. taxes payable		$12,760.00
	Employee medical insurance payable		$1,360.00
	Employee union dues payable		$800.00
	Salaries Payable                                       [Gross salaries - Deductions = ($22,760 + $70,840) - ($5,803.20 + $1,357.20 + $12,760 + $1,360 + $800)]		$71,519.60
	(To record the payroll expense and liabilities)

.

.

2. Entry to record the employer payroll taxes
Date	General Journal	Debit	Credit
Jan. 08	Payroll tax Expense                                      [Total taxes = $5,803.20 + $1,357.20 + $5,054.40 + $561.60]	$12,776.40
	FICA - Social Sec. Taxes payable		$5,803.20
	FICA - Medicare Taxes payable		$1,357.20
	State Unemployment Taxes Payable		$5,054.40
	Federal Unemployment Taxes Payable		$561.60
	(To record the payroll tax expense)