The following monthly data are taken from Ramirez Company at July 31: Sales sala
ID: 2607970 • Letter: T
Question
The following monthly data are taken from Ramirez Company at July 31: Sales salaries, $200,000; Office salaries, $160,000; Federal income taxes withheld, $90,000; State income taxes withheld, $20,000; Social security taxes withheld, $22,320; Medicare taxes withheld, $5,220; Medical insurance premiums, $7,000; Life insurance premiums, $4,000; Union dues deducted, $1,000; and Salaries subject to unemployment taxes, $50,000. The employee pays 40% of medical and life insurance premiums. Assume that FICA taxes are identical to those on employees and that SUTA taxes are 5.4% and FUTA taxes are 0.6%. 1&2. Using the above information, complete the below table and Prepare the journal entries to record accrued payroll and cash payment of the net payroll for July. 3. Using the above information, complete the below table 4. Record the accrued employer payroll taxes and all other employer-paid expenses and the cash payment of all liabilities for July- assume that FICA taxes are identical to those on employees and that SUTA taxes are 5.4% and FUTA taxes are 0.6%Explanation / Answer
Date
General Journal
Debit
Credit
July 31
Payroll Tax Expenses
37140
FICA-Social Security Tax Payable
22320
FICA-Medicare Tax Payable
5220
Employee Medical Insurance Payable
4200
Employee Life Insurance Payable
2400
State Unemployment Taxes Payable
2700
Federal Unemployment Taxes Payable
300
Record the Cash Payment of Salaries of all liabilities for July
July 31
FICA-Social Security Tax Payable
44640
FICA-Medicare Tax Payable
10440
Employee Federal Income Tax Payable
90000
Employee State Income Tax Payable
20000
Employee Medical Insurance Payable
7000
Employee Life Insurance Payable
4000
Employee Union Dues Payable
1000
State Unemployment Taxes Payable
2700
Federal Unemployment Taxes Payable
300
Cash
180080
Employee Medical Insurance Payable =7000*60% = 4200 (40% is paid and 60% is payable)
Employee Life Insurance Payable = =4000*60% = 2400
State Unemployment Taxes Payable = =50000*5.4% = 2700
Federal Unemployment Taxes Payable = =50000*0.6% = 300
Date
General Journal
Debit
Credit
July 31
Payroll Tax Expenses
37140
FICA-Social Security Tax Payable
22320
FICA-Medicare Tax Payable
5220
Employee Medical Insurance Payable
4200
Employee Life Insurance Payable
2400
State Unemployment Taxes Payable
2700
Federal Unemployment Taxes Payable
300
Record the Cash Payment of Salaries of all liabilities for July
July 31
FICA-Social Security Tax Payable
44640
FICA-Medicare Tax Payable
10440
Employee Federal Income Tax Payable
90000
Employee State Income Tax Payable
20000
Employee Medical Insurance Payable
7000
Employee Life Insurance Payable
4000
Employee Union Dues Payable
1000
State Unemployment Taxes Payable
2700
Federal Unemployment Taxes Payable
300
Cash
180080
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.