Question

A) Beth Corbin’s regular hourly wage rate is $22, and she receives an hourly rate of $33 for work in excess of 40 hours. During a January pay period, Beth works 45 hours. Beth’s federal income tax withholding is $94, and she has no voluntary deductions. Use January 15 for the end of the pay period and the payment date.

Prepare the journal entries to record (a) Beth’s pay for the period and (b) the payment of Beth’s wages.

(Assume FICA rate of 7.65%. Round your answers to 2 decimal places, e.g. 15.25.)

B) Beth Corbin’s regular hourly wage rate is $12, and she receives an hourly rate of $18 for work in excess of 40 hours. During a January pay period, Beth works 46 hours. Beth’s federal income tax withholding is $98, and she has no voluntary deductions.

Compute Beth Corbin’s gross earnings and net pay for the pay period. (Assume FICA rate of 7.65%. Round the answers to 2 decimal places, e.g. 15.25.)

C) According to the accountant of Ulster Inc., its payroll taxes for the week were as follows: $133.50 for FICA taxes, $16.50 for federal unemployment taxes, and $93.00 for state unemployment taxes. Journalize the entry to record the accrual of the payroll taxes.

Answer 1

A
	Gross earnings	1045	=(40*22)+(5*33)
		Debit	Credit
(a) Jan 15	Salaries and Wages expense	1045.00
	Federal Income taxes payable		94.00
	FICA taxes payable		79.94	=1045*7.65%
	Salaries and Wages payable		871.06
(b) Jan 15	Salaries and Wages payable	871.06
	Cash		871.06
B
	Gross earnings	588	=(40*12)+(6*18)
	Less: Deductions
	Federal Income taxes	98.00
	FICA taxes	44.98	=588*7.65%
	Net pay	445.02
C
		Debit	Credit
	Payroll Tax expense	243.00
	FICA taxes payable		133.50
	Federal unemployment taxes payable		16.50
	State unemployment taxes payable		93.00