The following monthly data are taken from Ramirez Company at July 31: Sales sala
ID: 2469730 • Letter: T
Question
The following monthly data are taken from Ramirez Company at July 31: Sales salaries, $620,000; Office salaries, $124,000; Federal income taxes withheld, $186,000; State income taxes withheld, $41,500; Social security taxes withheld, $46,128; Medicare taxes withheld, $10,788; Medical insurance premiums, $15,000; Life insurance premiums, $12,000; Union dues deducted, $9,000; and Salaries subject to unemployment taxes, $66,000. The employee pays forty percent of medical and life insurance premiums.
Record the accrued employer payroll taxes and other employer-paid expenses and the cash payment of all liabilities for July-assume that FICA taxes are identical to those on employees and that SUTA taxes are 5.4% and FUTA taxes are 0.6%
Record the accrued employer payroll taxes and other employer-paid expenses and the cash payment of all liabilities for July-assume that FICA taxes are identical to those on employees and that SUTA taxes are 5.4% and FUTA taxes are 0.6%
Explanation / Answer
Date
Account titles and explanation
Debit
Credit
Jul-31
Payroll tax expenses
$ 77,076.00
FICA - Social security taxes payable
$ 46,128.00
FICA - Medicare taxes payable
$ 10,788.00
SUTA payable
($66,000 * 5.4%)
$ 3,564.00
FUTA payable
($66,000 * 0.6%)
$ 396.00
Employee medical insurance payable
($15,000 * 0.60)
$ 9,000.00
Employee life insurance payable
($12,000 * 0.60)
$ 7,200.00
Jul-31
FICA - Social security taxes payable
$ 46,128.00
FICA - Medicare taxes payable
$ 10,788.00
SUTA payable
$ 3,564.00
FUTA payable
$ 396.00
Employee medical insurance payable
$ 9,000.00
Employee life insurance payable
$ 7,200.00
Cash
$ 77,076.00
Date
Account titles and explanation
Debit
Credit
Jul-31
Payroll tax expenses
$ 77,076.00
FICA - Social security taxes payable
$ 46,128.00
FICA - Medicare taxes payable
$ 10,788.00
SUTA payable
($66,000 * 5.4%)
$ 3,564.00
FUTA payable
($66,000 * 0.6%)
$ 396.00
Employee medical insurance payable
($15,000 * 0.60)
$ 9,000.00
Employee life insurance payable
($12,000 * 0.60)
$ 7,200.00
Jul-31
FICA - Social security taxes payable
$ 46,128.00
FICA - Medicare taxes payable
$ 10,788.00
SUTA payable
$ 3,564.00
FUTA payable
$ 396.00
Employee medical insurance payable
$ 9,000.00
Employee life insurance payable
$ 7,200.00
Cash
$ 77,076.00
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