Question

The Company needs to accrue its final Payroll of the year Dec 16-31, 2017, which will be paid on Jan 5, 2018. Total Salary and Wage accrual for the period is $75,000, and the payroll tax accrual for Company payroll tax expense is an extra 8% of the $75,000. Record in the separate accounts on the journal entry

Answer 1

Journal entry
Date	Particulars	Debit ($)	Credit ($)
31/12/2017	Salary and wages expense	75000
	Salary and wages payable		75000
	To record the accrual of final payroll of the year Dec 16-31, 2017
31/12/2017	Payroll tax expense	6000
	Payroll tax accrual		6000
	To record the accrual of payroll tax expense @ 8% of total salaries
	A combined entry may also be passed for the accrual of salary and wages and payroll taxes as Salary and wages expense       75000 Payroll tax expense                     6000 Salary and wages payable                             75000 Payroll tax accrual                                             6000
Payment of salaries entry will be recorded on Jan 5, 2018 as
5/1/2018	Salary and wages expense	75000
	Cash at Bank		75000
	To record payment of salary and wages
For payment of tax,
	Payroll tax accrual	6000
	Cash at Bank		6000
	To record payment of payroll tax expense