1. Calculate Payroll
Breakin Away Company has three employees-a consultant, a computer programmer, and an administrator. The following payroll information is available for each employee:
Consultant | Computer Programmer | Administrator | ||||
Regular earnings rate | $2,910 per week | $30 per hour | $44 per hour | |||
Overtime earnings rate | Not applicable | 1.5 times hourly rate | 2 times hourly rate | |||
Number of withholding allowances | 3 | 2 | 1 |
For the current pay period, the computer programmer worked 60 hours and the administrator worked 50 hours. The federal income tax withheld for all three employees, who are single, can be determined by adding $356.90 to 28% of the difference between the employee's amount subject to withholding and $1,796.00. Assume further that the social security tax rate was 6%, the Medicare tax rate was 1.5%, and one withholding allowance is $70.
Determine the gross pay and the net pay for each of the three employees for the current pay period. Assume the normal working hours in a week are 40 hours. If required, round your answers to two decimal places.
Consultant | Computer Programmer | Administrator | |
Gross pay | $ | $ | $ |
Net pay | $ | $ | $ |
2.
Summary Payroll Data
In the following summary of data for a payroll period, some amounts have been intentionally omitted:
Earnings: | ||
1. At regular rate | ? | |
2. At overtime rate | $65,100 | |
3. Total earnings | ? | |
Deductions: | ||
4. Social security tax | 26,040 | |
5. Medicare tax | 6,510 | |
6. Income tax withheld | 110,700 | |
7. Medical insurance | 15,000 | |
8. Union dues | ? | |
9. Total deductions | 161,000 | |
10. Net amount paid | 273,000 | |
Accounts debited: | ||
11. Factory Wages | 230,000 | |
12. Sales Salaries | ? | |
13. Office Salaries | 86,800 |
a. Calculate the amounts omitted in lines (1), (3), (8), and (12).
(1) | $ |
(3) | $ |
(8) | $ |
(12) | $ |
b. Journalize the entry to record the payroll accrual. If an amount box does not require an entry, leave it blank.
c. Journalize the entry to record the payment of the payroll.
The payroll register for Gamble Company for the week ended April 29 indicated the following:
Salaries | $1,440,000 |
Social security tax withheld | 86,400 |
Medicare tax withheld | 21,600 |
Federal income tax withheld | 288,000 |
In addition, state and federal unemployment taxes were calculated at the rate of 5.4% and 0.6%, respectively, on $244,000 of salaries.
Required: | |||
A. | Journalize the entry to record the payroll for the week of April 29.* | ||
B. | Journalize the entry to record the payroll tax expense incurred
for the week of April 29.*
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