A company has three employees, each of whom has been employed since January 1, e

Question

A company has three employees, each of whom has been employed since January 1, earns $3,350 per month, and is paid on the last day of each month. On March 1, the following accounts and balances appeared in its ledger.

a. Employees’ Income Taxes Payable, $1,296.90 (liability for February).
b. EI Payable, $509.70 (liability for February).
c. CPP Payable, $857.10 (liability for February).
d. Employees’ Medical Insurance Payable, $1,860.00 (liability for January and February).

During March and April, the company completed the following related to payroll.

Mar. 17 Issued cheque #320 payable to the Receiver General for Canada. The cheque was in payment of the February employee income taxes, EI, and CPP amounts due.
Mar. 31 Prepared a general journal entry to record the March payroll register, which had the following column totals:

Mar. 31 Recorded the employer’s $441.40 liability for its 50% contribution to the medical insurance plan of employees and 6% vacation pay accrued to the employees.
Mar. 31 Prepared a general journal entry to record the employer’s costs resulting from the March payroll.
Apr. 17 Issued cheque #525 payable to the Receiver General for Canada in payment of the March mandatory deductions.
Apr. 17 Issued cheque #526 payable to All Canadian Insurance Company in payment of the employee medical insurance premiums for the first quarter.

Required:
Prepare the entries to record the transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your answers to 2 decimal places. Do not round intermediate calculations.)

EI Income Taxes CPP Medical Insurance Total Deductions Net Pay Office Salaries Shop Salaries $183.92 $1,296.90 $454.16 $441.40 $2,376.38 $7,673.62 $3,350.00 $6,700.00

Explanation / Answer

Date Account Title Debit Credit 17-Mar Employees’ Income Taxes Payable 1296.9 EI Payable 509.7 CPP Payable 857.1 Cash 2663.7 31-Mar Office Salaries Expense 3350 Shop Salaries Expense 6700 EI Payable 183.92 Income Taxes Payable 1296.9 CPP 454.16 Medical Insurance Payable 441.4 Salaries payable 7673.62 Employees Medical Insurance expense 441.4 Benefits expense(6%*10050) 603 Medical Insurance Payable 441.4 Vacation pay liability 603 Salaries payable 7673.62 Cash 7673.62 17-Apr EI Payable 183.92 Income Taxes Payable 1296.9 CPP 454.16 Cash 1934.98 Medical Insurance Payable 2742.8 Cash 2742.8 (1860+441.40+441.40)

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