The following monthly data are taken from Ramirez Company at July 31: Sales salaries, $560,000; Office salaries, $112,000; Federal income taxes withheld, $168,000; State income taxes withheld, $37,500; Social security taxes withheld, $41,664; Medicare taxes withheld, $9,744; Medical insurance premiums, $13,500; Life insurance premiums, $10,500; Union dues deducted, $7,500; and Salaries subject to unemployment taxes, $63,000. The employee pays 40% of medical and life insurance premiums. Assume that FICA taxes are identical to those on employees and that SUTA taxes are 5.4% and FUTA taxes are 0.6%. 1&2. Using the above information, complete the below table and prepare the journal entries to record accrued payroll and cash payment of the net payroll for July. 3. Using the above information, complete the below table. 4. Record the accrued employer payroll taxes and all other employer-paid expenses and the cash payment of all liabilities for July-assume that FICA taxes are identical to those on employees and that SUTA taxes are 5.4% and FUTA taxes are 0.6%
Tabel 1 | ||||
Total premium | % paid by employees |
Premium paid by employees (Total premium x 40%) |
Premium paid by employer [(Total premium x (100% - 40%)] |
|
Employee Medical Insurance Payable | $13,500 | 40% | $5,400 | $8,100 |
Employee Life Insurance Payable | $10,500 | 40% | $4,200 | $6,300 |
.
.
2. Journal entry for accrued payroll, including employee deductions, for July | |||
Date | General Journal | Debit | Credit |
July 31 | Sales Salaries | $560,000 | |
Office Salaries | $112,000 | ||
Employee fed. Inc. taxes payable | $168,000 | ||
Employee state inc. taxespayable | $37,500 | ||
FICA - Social Sec. taxes payable | $41,664 | ||
FICA - Medicare taxes payable | $9,744 | ||
Employee medical insurance payable [Refer table 1] | $5,400 | ||
Employee life insurance payable [Refer table 1] | $4,200 | ||
Employee union dues payable | $7,500 | ||
Salaries payable [Refer working note 1] | $397,992 | ||
Record the cash payment of salaries: | |||
Date | General Journal | Debit | Credit |
July 31 | Salaries payable | $397,992 | |
Cash | $397,992 |
.
.
Table 2 | |||
Tax |
Amounts Subject to Tax (a) |
Tax Rate (b) |
Tax Amount (a x b) |
State Unemployment Taxes Payable | $63,000 | 5.40% | $3,402 |
Federal Unemployment Taxes Payable | $63,000 | 0.6% | $378 |
.
.
4. Journal entries to record cash payment of all liabilities related to the July payroll. | ||||
No. | Date | General Journal | Debit | Credit |
1 | July 31 | Payroll taxes expense [$41,664 + $9,744 + $3,402 + $378] | $55,188 | |
FICA - Social Sec. taxes payable | $41,664 | |||
FICA - Medicare taxes payable | $9,744 | |||
Federal unemployment taxes payable | $3,402 | |||
State unemployment taxes payable | $378 | |||
Record the employer's benefit expense | ||||
No. | Date | General Journal | Debit | Credit |
2 | July 31 | Employee benefits expense [$8,100 + $6,300] | $14,400 | |
Employee medical insurance payable [Refer table 1] | $8,100 | |||
Employee life insurance payable [Refer table 1] | $6,300 | |||
Record the cash payment of all liabilities related to the July payroll. | ||||
No. | Date | General Journal | Debit | Credit |
3 | July 31 | FICA - Social Sec. taxes payable [Employer contribution + Employee contribution = $41,664 + $41,664] | $83,328 | |
FICA - Medicare taxes payable [Employer contribution + Employee contribution = $9,744 + $9,744] | $19,488 | |||
Employee fed. Inc. taxes payable | $168,000 | |||
Employee State. Inc. taxes payable | $37,500 | |||
Employee medical insurance payable | $13,500 | |||
Employee life insurance payable | $10,500 | |||
Employee union dues payable | $7,500 | |||
Federal unemployment taxes payable [Refer Table 2] | $3,402 | |||
State unemployment taxes payable [Refer Table 2] | $378 | |||
cash [Refer working note 2] | $343,596 |
.
.
Working note 1 - Computation of net salaries payable to employees | ||
Amount | Amount | |
Salaries: | ||
Sales Salaries | $560,000 | |
Office Salaries | $112,000 | |
Total salaries (a) | $672,000 | |
Total deductions: | ||
Employee fed. Inc. taxes payable | $168,000 | |
Employee state inc. taxespayable | $37,500 | |
FICA - Social Sec. taxes payable | $41,664 | |
FICA - Medicare taxes payable | $9,744 | |
Employee medical insurance payable | $5,400 | |
Employee life insurance payable | $4,200 | |
Employee union dues payable | $7,500 | |
Total deduction (b) | $274,008 | |
Net salaries payable to employees (a - b) | $397,992 |
.
.
Working note 2 - Computation of amount of cash to be paid by the employer (excluding net salaries): | |
Amount | |
FICA - Social Sec. taxes payable [Employer contribution + Employee contribution = $41,664 + $41,664] | $83,328 |
FICA - Medicare taxes payable [Employer contribution + Employee contribution = $9,744 + $9,744] | $19,488 |
Employee fed. Inc. taxes payable | $168,000 |
Employee State. Inc. taxes payable | $37,500 |
Employee medical insurance payable | $13,500 |
Employee life insurance payable | $10,500 |
Employee union dues payable | $7,500 |
Federal unemployment taxes payable [Refer Table 2] | $3,402 |
State unemployment taxes payable [Refer Table 2] | $378 |
Total | $343,596 |
The following monthly data are taken from Ramirez Company at July 31: Sales salaries, $560,000; Office salaries, $112,00...
The following monthly data are taken from Ramirez Company at July 31: Sales salaries, $560,000; Office salaries, $112,000; Federal income taxes withheld, $168,000; State income taxes withheld, $37,500; Social security taxes withheld, $41,664; Medicare taxes withheld, $9,744; Medical insurance premiums, $13,500; Life insurance premiums, $10,500; Union dues deducted, $7,500; and Salaries subject to unemployment taxes, $63,000. The employee pays 40% of medical and life insurance premiums. Assume that FICA taxes are identical to those on employees and that SUTA taxes...
The following monthly data are taken from Ramirez Company at July 31: Sales salaries, $440,000; Office salaries, $88,000; Federal income taxes withheld, $132,000; State income taxes withheld, $29,500; Social security taxes withheld, $32,736; Medicare taxes withheld, $7,656; Medical insurance premiums, $10,500; Life insurance premiums, $7,500; Union dues deducted, $4,500; and Salaries subject to unemployment taxes, $57,000. The employee pays 40% of medical and life insurance premiums. Assume that FICA taxes are identical to those on employees and that SUTA taxes...
The following monthly data are taken from Ramirez Company at July 31: Sales salaries, $200,000; Office salaries, $160,000; Federal income taxes withheld, $90,000; State income taxes withheld, $20,000; Social security taxes withheld, $22,320; Medicare taxes withheld, $5,220; Medical insurance premiums, $7,000, Life insurance premiums, $4,000; Union dues deducted, $1,000; and Salaries subject to unemployment taxes, $50,000. The employee pays 40% of medical and life insurance premiums Assume that FICA taxes are identical to those on employees and that SUTA taxes...
the following monthly data are taken from ramirez company at july 31: sales salaries, 320,000; Office salaries, 64,000; federal income taxes withheld, 96,000; state income taxes withheld, 21,500; social security taxes withheld, 23,808; medicare taxes withheld, 5,568; medical insurance premiums, 7,500; life insurance premiums, 4,500; union dues deducted, 1,500; and salaries subject to unemployment taxes, 51,000. the employee pays 40% of medical and life insurance premiums. assume that FICA taxes are identical to those on employees and that SUTA taxes...
The following monthly data are taken from Ramirez Company at July 31: Sales salaries, $660,000, Office salaries, $132,000; Federal income taxes withheld, $198.000; State income taxes withheld, $44,000: Social security taxes withheld, $49,104; Medicare taxes withheld. $11.484; Medical insurance premiums, $16,000: Life insurance premiums, $13,000; Union dues deducted, $10,000, and Salaries subject to unemployment taxes, $68,000. The employee pays 40% of medical and life insurance premiums. Assume that FICA taxes are identical to those on employees and that SUTA taxes...
The following monthly data are taken from Ramirez Company at July 31: Sales salaries, $680,000; Office salaries, $136,000; Federal income taxes withheld, $204,000; State income taxes withheld, $45,500; Social security taxes withheld, $50,592; Medicare taxes withheld, $11,832; Medical insurance premiums, $16,500; Life insurance premiums, $13,500; Union dues deducted, $10,500, and Salaries subject to unemployment taxes, $69,000. The employee pays 40% of medical and life insurance premiums. Assume that FICA taxes are identical to those on employees and that SUTA taxes...
Help Save! The following monthly data are taken from Ramirez Company at July 31: Sales salaries. $560,000, Office salaries. $112.000; Federal ncome taxes withheld, $168.000. State income taxes withheld, $37,500, Social security taxes withheld, $41,664 Medicare taxes withheld. $9.744: Medical insurance premiums. $13.500; Life insurance premiums, $10.500, Union dues deducted, $7,500 and Salaries subject to unemployment taxes, $63,000. The employee pays 40% of medical and life insurance premiums. Assume that FICA taxes are identical to those on employees and that...
The following monthly data are taken from Ramirez Company at July 31: Sales salaries, $700,000; Office salaries, $140,000: Federal income taxes withheld, $210,000; State income taxes withheld, $47000: Social security taxes withheld, $52,080; Medicare taxes withheld, $12,180; Medical insurance premlums, $17,000: Life insurance premiums, $14,000: Union dues deducted, $11,000, and Salaries subject to unemployment taxes, $70,000. The employee pays 40% of medical and life insurance premiums. Assume that FICA taxes are identical to those on employees and that SUTA taxes...
The following monthly data are taken from Ramirez Company at July 31: Sales salaries, $420,000; Office salaries, $84,000; Federal income taxes withheld, $126,000, State income taxes withheld, $28,000; Social security taxes withheld, $31,248; Medicare taxes withheld, $7,308; Medical insurance premiums, $10,000; Life insurance premiums. $7000: Union dues deducted, $4,000, and Salaries subject to unemployment taxes, $56,000. The employee pays 40% of medical and life insurance premiums. Assume that FICA taxes are identical to those on employees and that SUTA taxes...
multi part question, i leave good feedback The following monthly data are taken from Ramirez Company at July 31: Sales salartes, $560,000; Office salaries, $112,000; Federal Income taxes withheld, $168,000; State Income taxes withheld, $37,500, Social security taxes withheld, $41,664; Medicare taxes withheld, $9,744; Medical Insurance premlums, $13,500; Life Insurance premlums, $10,500, Union dues deducted, $7,500, and Salarles subject to unemployment taxes, $63,000. The employee pays 40 % of medical and life Insurance premlums. Assume that FICA taxes are identical...