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EX 10-10 Summary payroll data In the following summary of data for a payroll per

ID: 2560374 • Letter: E

Question

EX 10-10 Summary payroll data In the following summary of data for a payroll period, some amounts ally omitted: OBJ. 2,3 been intention- have Earnings 1. At regular rate 2. At overtime rate 3. Total earnings $80,000 Deductions: 4. Social security tax 5. Medicare tax 6. Income tax withheld 7. Medical insurance 8. Union dues 9. Total deductions 32,400 8,100 135,000 18,900 201,150 338,850 285,000 120,000 a. Calculate the amounts omitted in lines (), (3), (8), and (12). 10. Net amount paid Accounts debited: 11. Factory Wages 12. Sales Salaries 13. Office Salaries b. Journalize the entry to record the payroll accrual. c. Journalize the entry to record the payment of the payroll.

Explanation / Answer

a. Calculate the amounts omitted in lines (1), (3), (8), and (12)

Calculation of 3 i.e. Total earnings = Net amount paid + Total deductions

.......................................................= $338,850 + $201,150

.......................................................= $540,000

Calculation of 1 i.e. At Reguler Rate = Total earnings - At Overtime Rate

..........................................................= $540,000 - $80,000

..........................................................= $4,60,000

Calculation of 8 i.e. Union dues = Total Deductions - (Social Security tax + Medicare tax + Income tax withheld + Medical Insurance)

...................................................= $201,150 - ($32,400 + $8,100 + $135,000 + $18,900)

...................................................= $6,750

Calculation of 12 i.e. Sales Salaries = Total Earnings - (Factory Wages + Office Salaries)

..........................................................= $540,000 - ($285,000 + $120,000)

..........................................................= $135,000

b. Journalize the entry to record the payroll accrual.

c. Journalize the entry to record the payment of the payroll.

Accounts Debit Credit Factory Wages Expense $285,000 Sales Salaries Expense $135,000 Office Salaries Expense $120,000 Social Security Tax Payable $32,400 Medicare Tax Payable $8,100 Income Tax Withheld Payable $135,000 Medical Insurance Payable $18,900 Union dues Payable $6,750 Net Payroll Payable $338,850 (To record payroll accrual)