RNG Co. has one employee, and the company is subject to the following taxes. Tax
ID: 2355050 • Letter: R
Question
RNG Co. has one employee, and the company is subject to the following taxes.Tax
Rate
Applied to
FICA—Social Security
6.20 %
First $102,000
FICA—Medicare
1.45
All gross pay
FUTA
0.80
First $7,000
SUTA
2.90
First $7,000
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Gross Pay through August $6,200
Gross Pay for September $1,800
Using the above situation, prepare the employer's September 30 journal entries to record the following
-Salary expense and its related payroll liabilities for this employee. The employee’s federal income taxes withheld by the employer are $279 for this pay period.
-the employer's payroll taxes expense and its related liabilities
Explanation / Answer
FICA Social Security (September) = 1800 * 6.2% = 111.6$
FICA Medicare (September) = 1800 * 1.45% = 26.1$
FUTA (September) = (7000-6200) * 0.80% = 6.4$ (only 800$ is taxable)
SUTA (September) = (7000-6200) * 2.9% = 23.2$ (only 800$ is taxable)
Payroll Expense Journel
Debit Credit
Sep Payroll Expense 1800
FICA Social Security Tax Payable 111.6
FICA Medicare Tax Payable 26.1
Federal income Tax Payable 279
Accrued Salaries Payable 1383.3
Recording Employer Payroll Taxes
Debit Credit
Sep Payroll Tax Expense 167.3
FICA Social Security Tax Payable 111.6
FICA Medicare Tax Payable 26.1
State Unemployment Tax Payable(SUTA) 23.2
Federal Unemployment Tax Payable(FUTA) 6.4
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