Journal entry for the following: Paid the semi-monthly payroll, $2,500 if direct
ID: 2462410 • Letter: J
Question
Journal entry for the following: Paid the semi-monthly payroll, $2,500 if direct labor for Job#1 (250 hours), and $400 for indirect labor (40 hours), and $1,100 as Salary expense [for administrative and selling salaries]. The amounts withheld are $500 for income taxes and $350 for FICA taxes. NOTE: A second journal entry for the employer's portion of the payroll taxes must be recorded. This includes matching the FICA taxes, .8% for Federal Unemployment taxes and 5.4% for State Unemployment taxes.
Explanation / Answer
Journal entry for semi monthly payroll:
Date
Account title & explanation
Debit
Credit
Salary expenses
$ 2,500
Salary expenses - administrative dept.
$ 1,100
Overhead (indirect labor)
$ 400
Federal income tax withholdings payable
$ 500
FICA tax payable
$ 350
Net payroll payable
$ 3,150
(recorded semi monthly payroll)
Journal entry to record employer’s payroll taxes:
Date
Account title & explanation
Debit
Credit
Payroll tax expenses
$ 545
FICA payable
$ 350
FUTA payable ($3,150*0.008)
$ 25
SUTA payable ($3,150*0.054)
$ 170
(Employer’s taxes recorded)
Date
Account title & explanation
Debit
Credit
Salary expenses
$ 2,500
Salary expenses - administrative dept.
$ 1,100
Overhead (indirect labor)
$ 400
Federal income tax withholdings payable
$ 500
FICA tax payable
$ 350
Net payroll payable
$ 3,150
(recorded semi monthly payroll)
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