Question

The payroll register for Gamble Company for the week ended April 29 indicated the following:

Salaries	$1,500,000
Social security tax withheld	90,000
Medicare tax withheld	22,500
Federal income tax withheld	300,000

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.* *Refer to the Chart of Accounts for exact wording of account titles.

CHART OF ACCOUNTSGamble CompanyGeneral Ledger

	ASSETS
110	Cash
111	Accounts Receivable
112	Interest Receivable
113	Notes Receivable
115	Merchandise Inventory
116	Supplies
118	Prepaid Insurance
120	Land
123	Building
124	Accumulated Depreciation-Building
125	Office Equipment
126	Accumulated Depreciation-Office Equipment

	LIABILITIES
210	Accounts Payable
213	Interest Payable
214	Notes Payable
215	Salaries Payable
216	Social Security Tax Payable
217	Medicare Tax Payable
218	Employees Federal Income Tax Payable
219	Employees State Income Tax Payable
221	Retirement Savings Deductions Payable
224	Federal Unemployment Tax Payable
225	State Unemployment Tax Payable
226	Vacation Pay Payable
227	Unfunded Pension Liability
228	Product Warranty Payable

	EQUITY
310	Owner, Capital
311	Owner, Drawing
312	Income Summary

	REVENUE
410	Sales
610	Interest Revenue

	EXPENSES
510	Cost of Merchandise Sold
520	Salaries Expense
524	Depreciation Expense-Building
525	Delivery Expense
526	Repairs Expense
529	Selling Expenses
531	Rent Expense
532	Depreciation Expense-Office Equipment
533	Insurance Expense
534	Supplies Expense
535	Payroll Tax Expense
536	Vacation Pay Expense
537	Pension Expense
538	Cash Short and Over
539	Product Warranty Expense
540	Miscellaneous Expense
710	Interest Expense

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.* *Refer to the Chart of Accounts for exact wording of account titles.

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JOURNAL

ACCOUNTING EQUATION

	DATE	DESCRIPTION	POST. REF.	DEBIT	CREDIT	ASSETS	LIABILITIES	EQUITY
1
2
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Answer 1

	DATE	DESCRIPTION	POST. REF.	DEBIT	CREDIT	ASSETS	LIABILITIES	EQUITY
1	Apr-29	Salaries expense	520	1,500,000				Decrease
		Social security tax payable	216		90,000		Increase
		Medicare tax payable	217		22,500		Increase
		Employees federal income tax payable	218		300,000		Increase
		Salaries payable	215				Increase
		( To record payroll and related taxes)
2	Apr-29	Payroll tax expense	535	127,140				Decrease
		Social security tax payable	216		90,000		Increase
		Medicare tax payable	217		22,500		Increase
		State unemployment tax payable	225		13,176		Increase
		Federal unemployment tax payable	224		1,464		Increase
		( To record payroll expense)

State Unemployment Tax Payable = Gross salary x State unemployment tax rate

= 244,000 x 5.4%

= $13,176

Federal Unemployment Tax Payable = Gross salary x Federal unemployment tax rate

= 244,000 x 0.6%

= $1,464

Kindly comment if you need further assistance. Thanks‼!