Question

Journal entries to record both employee and employer payroll compensation and deductions. 

I strongly recommend that you print out these facts for easy reference in completing this lengthy payroll problem.

Marc & Associates employs Janet Evanovich at its law firm and June is the first pay period for Janet. Her gross income for June is $7,500. FUTA taxes are 0.6% and SUTA taxes are 5.4% of the first $7,000 paid to the employee. Payroll for the month of June follows: FICA Social Security tax rate at 6.2%, FICA Medicare tax rate at 1.45%, federal income tax of $650, state income tax of $60, local income tax of $30, health-care insurance premium of $300, pension plan contribution of $200, and donations to a charity of $50. The employee is responsible for covering 40% of her health insurance premium. The employer is responsible for 60% of the health insurance premium. The employer matches 50% of employee pension plan contributions.

Cash	Health Insurance Payable	Union Dues Payable
Benefits Expense	State Unemployment Tax Payable	Federal Unemployment Tax Payable
Salaries Expense	FICA Medicare Tax Payable	Federal Income Tax Payable
401(k) Retirement Plan Payable	Employer Payroll Taxes Expense	Vacation Benefit Payable
Local Income Tax Payable	Pension Plan Payable	Donations Payable
Salaries Payable	State Income Tax Payable	FICA Social Security Tax Payable

PLEASE NOTE: You must follow the format in the textbook, along with the order of the payroll items listed in the problem above. You will enter the account names exactly as written above and all dollar amounts will be rounded to two decimal places using "$" with commas as needed (i.e. $12,345).

Record the journal entry to recognize employee payroll for the month of June; dated June 30, 2017.

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Record remittance of the employee’s salary with cash on July 1.

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• Record the two journal entries for the employer payroll for the month of June, dated June 30, 2017.

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  CR
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  CR

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• Record the two journal entries for the payment in cash of all employer liabilities only on July 1.

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  CR

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• DR
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  DR
  CR

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