Question

An employee receives an hourly rate of $15, with time and a half for all hours worked in excess of 40 during the week. Payroll data for the current week are as follows: hours worked, 46; federal income tax withheld, $120; all earnings are subject to social security tax; Social security tax rate, 6%; and Medicare tax rate, 1.5%; state unemployment compensation tax, 3.4% on the first $7,000; federal unemployment compensation tax, 0.8% on the first $7,000. Prepare the journal entries to record the salaries expense and the employer payroll tax expense. If required, round your answers to the nearest cent.

Prepare the journal entry to record the salaries expense. If required, round your answers to two decimal places. If an amount box does not require an entry, leave it blank or enter "0".

Prepare the journal entry to record the employer payroll tax expense. If required, round your answers to two decimal places. If an amount box does not require an entry, leave it blank or enter "0".

Answer 1

Total Houors worked				46
Regular wages (40*15)				600
Ovrertime wages (6*15*1.5)				135
Gross wages				735
Employees dedcutions:
Federal income tax				120
FICA social security tax			(735*6%)	44.1
FICA Medicare tax			(735*1.50%)	11.03
Net wages				559.87
Employer Payroll tax expense
FICA social security tax			(735*6%)	44.1
FICA Medicare tax			(735*1.50%)	11.03
Federal Unemployment tax			(735*0.80%)	5.88
State Unemployment tax			(735*3.40%)	24.99
Total				86
Journal entries
Salaries and wages Expense Dr.			735
Federal Income tax payable				120
FICA social secutity tax payable				44.1
FICA Medicare tax payable				11.03
Salaries and wages payable				559.87
Payroll tax expense Dr.			86
FICA social secutity tax payable				44.1
FICA Medicare tax payable				11.03
Federal Unemployment tax payable				5.88
State Unemployment tax payable				24.99