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Kip Bowman is owner and sole employee of KB Corporation. He pays himself a salar

ID: 2405923 • Letter: K

Question

Kip Bowman is owner and sole employee of KB Corporation. He pays himself a salary of $1,650 each week.

Payment of Wages and Payroll Taxes

Record the payroll entry and payroll tax entry for the pay of the week ended June 1 (his year-to-date pay is $34,650).

If an amount box does not require an entry, leave it blank or enter "0". Round your answers to the nearest cent.

Additional tax information includes:   FICA tax—OASDI 6.2% on first $127,200   FICA tax—HI 1.45% on total pay   Federal income tax $247.50 per pay   State income tax 22% of the federal income tax withholding   Federal unemployment tax 0.6% on first $7,000   State unemployment tax 0.05% on first $14,000 Additional payroll deductions include:   401(k) plan 3% per pay   Child support garnishment $120 per pay   Health insurance premium $90 per pay

Explanation / Answer

EXPLANATION ---- Payment of Wages and Payroll Taxes

Account Debit Credit Payment of wages Wages Expense 1650 FICA Taxes Payable-OASDI 102.3 FICA Taxes Payable-HI 23.93 Employees FIT Payable 247.5 Employees SIT Payable 54.45 Retirement Plan Contributions Payable 49.5 Garnishment Payable 120 Health Insurance Premiums Payable 90 CASH 962.32 Payroll taxes FICA Taxes Payable-OASDI 102.3 FICA Taxes Payable-HI 23.93 Employees FIT Payable 247.5 Employees SIT Payable 54.45 CASH 428.18