In the following summary of data for payroll period some amounts have been inten

Question

In the following summary of data for payroll period some amounts have been intently omitted.
Earnings:
1.At regular rate:
2. At overtime rate: $135.000
3. Total earnings:

Deductions
4. Social Security Tax 54,000
5. Medicare Tax 13,500
6. Income tax withheld 225,000
7.Medical Insurance 31,500
8. Union Dues ?
9. Total Deduction 335,250
10. Net amount paid 564,750

Amount Debited
11. Factory Wages 475,000
12. Sales Salaries ?
13. Office Salaries 200,000

a. Calculate the amounts omitted in lines 1, 3,8, and 12
b. Journalize the entry to record the period annual
c. Journalize the entry to record the payment of payroll

Explanation / Answer

(a) (3) Total earnings can be computed by adding net pay and total deductions:252200+147800=400000. (1) Subtracting, you get $400000- $60,000 = 340000 (8) Union dues can be computed by totaling all the other deductions and subtracting total deductions: 23200+6000+99600+14000-252000=5000 (12) Sales salaries: 400000-210000-80000=110,000 (b). DR Wages 210,000, Sales salaries 110,000 Office salaries 80,000 CR Accd P/R 400,000 (c). Since the combined SS & Medicare rate is 7.65% on the first 106,800, and amount withheld above is 7.3%, this payroll must be later in the year.

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