6 8 0 8 0 7. A company\'s payroll for the week ended May 15 included earned sala

Question

6 8 0 8 0 7. A company's payroll for the week ended May 15 included earned salaries of $20,000. All of that week's pay is subject to FICA social security taxes of 6.2% and Medicare taxes of 1.45%. In addition, the company withholds the following amounts for this weekly pay period: $900 for medical insurance, $3,400 for federal income taxes, and $180 for union dues a. Prepare the general journal entry to accrue the payroll. b. The company is subject to state unemployment taxes at the rate of 2% and federal unemployment taxes at the rate of 0.6%. By May 15, some employees had earned over $7,000, so only $11,000 of the $20,000 weekly gross pay was subject to unemployment tax. Prepare the general journal entry to accrue the employer's payroll tax expense.

Explanation / Answer

a Salaries and wages expense 20000        FICA Social Security tax payable 1240 =20000*6.2%        FICA Medicare tax payable 290 =20000*1.45%        Medical insurance payable 900        Federal Income taxes payable 3400        Union dues payable 180        Salaries and wages payable 13990 b Payroll tax expense 1816        FICA Social Security tax payable 1240 =20000*6.2%        FICA Medicare tax payable 290 =20000*1.45%        State unemployment tax payable 220 =11000*2%        Federal unemployment tax payable 66 =11000*0.6%

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