Question

5. PAY ROLL PROBLEM

     Belinda West has earned gross pay of $420 for the current               

     payroll period. She authorizes a $10.00 per pay period

     deduction for health insurance. Belinda also pays 8% for

     federal income taxes, 4% for state income taxes and 6.2% of

     her salary for social security taxes and 1.45% for medicare

     taxes. Assume that Belinda has not reached the base limits

     for any tax rate. Also assume the Unemployment Tax rates are

     5.4% for state and .6% for federal.

1. Record the journal entry for Belinda West's employer to

    record her payroll.                       

                                             DEBIT    CREDIT

       

2. Record the journal entry to record the payroll tax expense     for Belinda West’s employer.

                                            DEBIT     CREDIT

Answer 1

Date	Account title	Debit	credit
a	salaries and wage expense	420
	Federal income tax payable (420*8%)		33.6
	State income tax payable (420*4%)		16.8
	social security tax payable (420*6.2%)		26.04
	medicare tax payable (420*1.45%)		6.09
	Health insurance payable		10
	cash /salaries and wage payable		327.47
b	Payroll tax expense	57.33
	social security tax payable (420*6.2%)		26.04
	medicare tax payable (420*1.45%)		6.09
	state unemployment taxes payable (420*5.4%)		22.68
	Federal unemployment taxes payable (420*.6%)		2.52