V-Liabilities 18 Points ant A The emplayees of Jackson\'s Sporting Goods eamed w
ID: 2594945 • Letter: V
Question
V-Liabilities 18 Points ant A The emplayees of Jackson's Sporting Goods eamed wages of $20,000 during December 2014.Federal income taxes witheld were $4,000;, Medicare taxes withheld were $290; Social Scurity taxtes witheld were $1 240.Jackson's Sporting Goods will pay the employees and all withholdings during the first week of January Using sither the accounting equation or journal entries, show the adjusting entry necessary or Jackson's Sporting Goods at the end of December 2014, including both the employees' anExplanation / Answer
Here FICA tax includes social security tax and Medicare.
Journal of employee payroll
Date
Accounts titles and explanations
P.ref
Debit $
Credit $
December, 2014
Salaries wages expense
20,000
Withholding tax
4,000
Social security tax payable
1,240
Medicare tax payable
290
Salaries and wages payable
14,470
To record salaries and wages liability to be paid after the necessary deductions
Journal of employer payroll
Date
Accounts titles and explanations
P.ref
Debit $
Credit $
Dec, 2014
Payroll tax expense
1,530
Social security tax payable
1,240
Medicare tax payable
290
To record employer’s tax liabilities
Note: There are two-way obligation of social security tax and Medicare tax; it means both employer and employee are liable to pay such tax; this is the reason why it appears in both the journals.
Date
Accounts titles and explanations
P.ref
Debit $
Credit $
December, 2014
Salaries wages expense
20,000
Withholding tax
4,000
Social security tax payable
1,240
Medicare tax payable
290
Salaries and wages payable
14,470
To record salaries and wages liability to be paid after the necessary deductions
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.