Question

Journalize Payroll Tax The payroll register of Chen Engineering Co. Indicates $1,860 of social security withheld and $465.00 of Medicare tax withheld on total salaries of $31,000 for the period. Earnings of $9,000 are subject to state and federal unemployment compensation taxes at the federal rate of 0.6% and the state rate of 5.4%. Provide the journal entry to record the payroll tax expense for the period. If an amount box does not require an entry, leave it blank. Round to two decimal places. Salaries Expense x Social Security Tax Expense X Medicare Tax Expense X Federal Unemployment Tax Expensex Cash X Feedback Check My Work Remember that there is typically a maximum amount of earnings subject to state and federal unemployment taxes

Answer 1

Employer is liable to pay social security tax and medicare tax equal to the amount paid by employee.

State unemployment tax payable = Earnings subject to tax x Tax rate

= 9,000 x 5.4%

= $486

Federal unemployment tax payable = Earnings subject to tax x Tax rate

= 9,000 x 0.6%

= $54

General Journal	Debit	Credit
Payroll tax expenses	$2,865
Social security tax payable		$1,860
Medicare tax payable		$465
State unemployment tax payable		$486
Federal unemployment tax payable		$54
( To record payroll tax expense)

Kindly comment if you need further assistance.

Thanks‼!