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Chrome File Edit View History Bookmarks People Window Help _ 43%10 Fri 11:36 AM QE CengageNOWv2 | Online teaching and learning resource from Cengage Learning v2 cengagenow.com rn takeAssignment takeAssignmentMan.do? n okers&ta; e AssignmentSessionLocator: assignment take& progress=false Chapter 10 Assignment eBook Show Me How Calculator Payroll Tax Entries According to a summary of the payroll of Mountain Streaming Co., $585,000 was subject to the 6.0% social security tax and the 1.5% Medicare tax. Also, $19,000 was subject to state and federal unemployment taxes. a Calculate the employer's payroll taxes, using the following rates: state unemployment, 4.2%; federal unemployment 8%. b. Journalize the entry to record the accrual of payroll taxes. If an amount box does not require an entry, leave it blank Check My Work Previous Next

Explanation / Answer

Payroll taxes:

a) Social security tax: 585,000 $ × 6%= 35,100 $ ( assuming wage is more than 585,000$

b) Medicare tax: 1.5% × 585,000$ = 8,775 $ ( assuming wage is 585,000 $

C) State employment tax: 19,000$ * 4.2%= 798$ (assuming wage is greater than 19,000$)

D) Federal unemployment tax: 19,000$ × 0.8% = 152$ ( assuming wage is more than 19,000 $)

2. Journal entry:

Social security tax Dr. 35,100$

Medicare tax Dr. 8,775$

State tax Dr. 798$

Federal unemployment tax Dr. 152$

To accrued liability : 44,825 $

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