Question

Grouper Company pays its office employee payroll weekly. Below is a partial list of employees and their payroll data for August. Because August is their vacation period, vacation pay is also listed.

Employee --Earnings to July 31----    Weekly Pay-----    Vacation Pay to Be Received in August

Mark Hamill $5,010    $200    ---

Karen Robbins $4,310 $150    $300

Brent Kirk    $3,510 $110 $220

Alec Guinness    $8,210 $250 ---

Ken Sprouse    $8,810 $330    $660

Assume that the federal income tax withheld is 10% of wages. Union dues withheld are 2% of wages. Vacations are taken the second and third weeks of August by Robbins, Kirk, and Sprouse. The state unemployment tax rate is 2.5% and the federal is 0.8%, both on a $7,000 maximum. The FICA rate is 7.65% on employee and employer on a maximum of $118,500 per employee. In addition, a 1.45% rate is charged both employer and employee for an employee’s wages in excess of $118,500.

Make the journal entries necessary for each of the four August payrolls. The entries for the payroll and for the company’s liability are made separately. Also make the entry to record the monthly payment of accrued payroll liabilities. (Round answers to 2 decimal places, e.g. 15.25. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

(To record Payroll 1.)

(To record Payroll taxes for Payroll 1.)

(To record payrolls 2 and 3.)

(To record payroll taxes for Payrolls 2 and 3.)

(To record payroll 4.)

(To record the monthly payment of accrued payroll liabilities.)

Answer 1

Journal Entry
Date	Particulars	Dr. Amt.	Cr. Amt.
1	Wages & Salaries Expense	1,040.00		$200 + $150 + $110 + $250 + $330
	Withholding Tax Payable		104.00	$1,040 X 10%
	FICA Tax Payable		79.56	$1,040 X 7.65%
	Union Dues Payable		20.80	$1,040 X 2%
	Cash		835.64
	(To record Payroll 1.)
2	Payroll Tax Expense	94.74
	FICA Tax Payable		79.56	$1,040 X 7.65%
	FUTA Payable		3.68	($200 + $150 + $110) X 0.80%
	SUTA Payable		11.50	($200 + $150 + $110) X 2.50%
	(To record Payroll taxes for Payroll 1.)
3	Vacation Wages Payable	590.00		($300 + $220 + $660)/2
	Wages & Salaries Expense	450.00
	Withholding Tax Payable		104.00	$1,040 X 10%
	FICA Tax Payable		79.56	$1,040 X 7.65%
	Union Dues Payable		20.80	$1,040 X 2%
	Cash		835.64
	(To record Payrolls 2 & 3.)
4	Payroll Tax Expense	94.74
	FICA Tax Payable		79.56	$1,040 X 7.65%
	FUTA Payable		3.68	($200 + $150 + $110) X 0.80%
	SUTA Payable		11.50	($200 + $150 + $110) X 2.50%
	(To record Payroll taxes for Payroll 2 & 3.)
5	Wages & Salaries Expense	1,040.00		$200 + $150 + $110 + $250 + $330
	Withholding Tax Payable		104.00	$1,040 X 10%
	FICA Tax Payable		79.56	$1,040 X 7.65%
	Union Dues Payable		20.80	$1,040 X 2%
	Cash		835.64
	(To record Payroll 4)
6	Payroll Tax Expense	94.74
	FICA Tax Payable		79.56	$1,040 X 7.65%
	FUTA Payable		3.68	($200 + $150 + $110) X 0.80%
	SUTA Payable		11.50	($200 + $150 + $110) X 2.50%
	(To record Payroll taxes for Payroll 4.)
7	Withholding Tax Payable	416.00
	Union Dues Payable	636.48
	FICA Tax Payable	83.20
	FUTA Payable	14.72
	SUTA Payable	46.00
	Cash		1,196.40
	(To record the monthly payment of accrued payroll liabilities.)