Record the May payroll using the payroll register information given above. Remem

Question

Record the May payroll using the payroll register information given above. Remember to record Social Security and Medicare withholdings (note that the Social Security limit has not been reached yet). Recorded the employer's payroll taxes resulting from the May payroll. The company has a state unemployment tax rate to 5.4% of the first $7.000 paid each employee and a federal unemployment tax rate of 0.8% of the first $7,000 paid each employee, (note that the federal and state unemployment limits have not been reached yet).

Explanation / Answer

The gross salary payable is debited while the deductions withheld by the employer for the payment of various taxes are credited. The amount left after all deductions is paid to the employees and is thus credited.

Wages and Salaries 60000 Federal Income Tax Payable 8200 State Income Tax Payable 2100 Medical Insurance Payable 800 FICA Tax Payable 4590 Cash 44310 FICA Tax Payable is calculated at 7.65%, i.e., 6.2% for Social Security & 1.45% for medicare

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