Exercise 10-5 During the month of March, Blossom Company’s employees earned wage
ID: 2526308 • Letter: E
Question
Exercise 10-5
During the month of March, Blossom Company’s employees earned wages of $72,000. Withholdings related to these wages were $5,508 for Social Security (FICA), $8,438 for federal income tax, $3,488 for state income tax, and $450 for union dues. The company incurred no cost related to these earnings for federal unemployment tax but incurred $788 for state unemployment tax.
Mar. 31
Account Titles and Explanation
Debit
Credit
SHOW LIST OF ACCOUNTS
Date
Account Titles and Explanation
Debit
Credit
Mar. 31
SHOW LIST OF ACCOUNTS
Exercise 10-5
During the month of March, Blossom Company’s employees earned wages of $72,000. Withholdings related to these wages were $5,508 for Social Security (FICA), $8,438 for federal income tax, $3,488 for state income tax, and $450 for union dues. The company incurred no cost related to these earnings for federal unemployment tax but incurred $788 for state unemployment tax.
Explanation / Answer
Prepare the necessary March 31 journal entry to record salaries and wages expense and salaries and wages payable. Assume that wages earned during March will be paid during April.
Account Titles and Explanation
Debit
Credit
Salaries and Wages Expense
$72,000
FICA Taxes Payable
$5,508
Federal Income Taxes Payable
$8,438
State Income Taxes Payable
$3,488
Union Dues Payable
$450
Salaries and Wages Payable
$54,116
Prepare the entry to record the company’s payroll tax expense.
Account Titles and Explanation
Debit
Credit
Payroll Tax Expense
$6,296
FICA Taxes Payable
$5,508
State Unemployment Taxes Payable
$788
Account Titles and Explanation
Debit
Credit
Salaries and Wages Expense
$72,000
FICA Taxes Payable
$5,508
Federal Income Taxes Payable
$8,438
State Income Taxes Payable
$3,488
Union Dues Payable
$450
Salaries and Wages Payable
$54,116
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