Question

Serial Problem Business Solutions LO P2, P3, C2 Following are some transactions and events of Business Solutions Feb. 26 The company paid cash to Lyn Addie for eight days' work at $130 per day Mar. 25 The company sold merchandise with a $2,032 cost for $3,000 on credit to Wildcat Services, invoice dated March 25. Required 1. Assume that Lyn Addie is an unmarried employee. Her $1,040 of wages are subject to no deductions other than FICA Social Security taxes, FICA Medicare taxes, and federal income taxes. Her federal income taxes for this pay period total $104. Compute her net pay for the eight days' work paid on February 26. (Round your answer to 2 decimal places. Do not round intermediate calculations pay

Answer 1

1	Calculation of Net pay for Lyn Addie	Amount ($)
	Gross pay of Lyn Addie's	1040
	Less: Deductions from Gross Salary:
	FICA – Social Security taxes (6.2%)	-64.48
	FICA – Medicare taxes (1.45%)	-15.08
	Federal Income Taxes	-104
	Net pay for Lyn Addie	856.44

2	Date	Account Titles and Explanation	Debit ($)	Credit ($)
	Feb 26, 2018	Salary A/C	1,040.00
		Cash		856.44
		FICA – Social Security taxes payable		64.48
		FICA – Medicare taxes payable		15.08
		Federal income taxes payable		104.00
3	Date	Account Titles and Explanation	Debit ($)	Credit ($)
	Feb 26, 2018	Payroll Tax Expense	127.40
		FICA – Social Security taxes payable		64.48
		FICA – Medicare taxes payable		15.08
		FUTA (1040*0.6%)		6.24
		SUTA (1040*4%)		41.60
4 (1)	Date	Account Titles and Explanation	Debit ($)	Credit ($)
	Mar 25, 2018	Wildcat Services	3,120.00
		Sales		3,000.00
		Sales Tax Payable (3000*4%)		120.00