Faber Company had gross wages of $110,000 during the week ended June 17. The amo

Question

Faber Company had gross wages of $110,000 during the week ended June 17. The amount of wages subject to social security tax was $110,000, while the amount of wages subject to federal and state unemployment taxes was $15,000. Tax rates are as follows: Social security 6.0% Medicare 1.5% State unemployment 5.4% Federal unemployment 0.8% The total amount withheld from employee wages for federal taxes was $22,000. a. Journalize the entry to record the payroll for the week of June 17. b. Journalize the entry to record the payroll tax expense incurred for the week of June 17

Explanation / Answer

a) total payroll = 110000 journal entry............................... debit ...............credit Cash..............................................................110000 Payroll expense............................110000 b) total taxes = 0.075*110000 + 0.062*15000 = 9180 journal entry debit credit Cash..............................................................9180 Tax expense............................9180

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