Recording Payroll and Payroll Taxes Manchester, Inc.. had the following payroll

Question

Recording Payroll and Payroll Taxes Manchester, Inc.. had the following payroll for March Finish 8 18) Officers' salaries Sales salaries Federal income taxes withheld FICA taxes withheld Health insurance premiums withheld $39,000 70,000 21,000 7,900 2,500 Salaries (included above) subject to federal unemployment taxes 65,000 Salaries (included above) subject to state unemployment taxes 75,000 Prepare journal entries on March 31 to record: a. Accrual of the monthly payrol. b. Payment of the net payroll. c. Accrual of employer's payroll taxes. (Assume that the FICA tax matches the amount withheld, the federal unemployment tax is 0.6 percent, and the state unemployment tax is 5.4 percent) d. Payment of all liabilities related to this payroll. (Assume that all are settled at the same General journal Description Credit Mar 31 Sales Salaries Expense 8

Explanation / Answer

Debit Credit 1 Officers Salaries 39,000.00 Sales Salaries 70,000.00 To Federal Income Tax Payable 21,000.00 FICA Taxes Payable     7,900.00 Health Insurance Payable     2,500.00 Salary Payable 77,600.00 2 Salary Payable 77,600.00 To Bank 77,600.00 3 FICA Taxes     7,900.00 Unemployment Tax- State        390.00 Unemployment Tax- Federal     4,050.00 Fica Tax Payable- E'r     7,900.00 Unemployment State Tax Payable        390.00 Unemployment Federal Tax Payable     4,050.00 4 Fica Tax Payable- E'r     7,900.00 Unemployment State Tax Payable        390.00 Unemployment Federal Tax Payable     4,050.00 Federal Income Tax Payable 21,000.00 FICA Taxes Payable     7,900.00 Health Insurance Payable     2,500.00 To Bank 43,740.00

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