Question

The following monthly data are taken from Ramirez Company at July 31: Sales salaries, $700,000; Office salaries, $140,000; Federal income taxes withheld, $210,000; State income taxes withheld, $47,000; Social security taxes withheld, $52,080; Medicare taxes withheld, $12,180; Medical insurance premiums, $17,000; Life insurance premiums, $14,000; Union dues deducted, $11,000; and Salaries subject to unemployment taxes, $70,000. 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%

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.

	Total Premium % Paid by Employees Premium Paid by Employees Premium Paid by Employer Employee Medical Insurance Payable Employee Life Insurance Payable Date General Journal Debit Credit Record journal entry for accrued payroll, including employee deductions, for July. July 31 Record the cash payment of salaries. July 31

Using the above information, complete the below table.

	Tax Amounts Subject to Tax Tax Rate Tax Amount State Unemployment Taxes Payable Federal Unemployment Taxes Payable

• Record all employer's payroll expenses and liabilities for the month of July.

• 2

  Record the employer's benefit expense.

• 3

  Record the cash payment of all liabilities related to the July payroll.

Answer 1

1&2.					Total Premium	% paid by employee	Premium paid by employees	Premium paid by employer
					1	2	3=1*2	4=1-3
	Employee medical insurance payable				17000	40%	6800	10200
	Employee life insurance payable				14000	40%	5600	8400
	Journal entry for accrued payroll:
	Date	Particulars							Debit	Credit
	July	Sales salaries expenses							700000
		Office salaries expenses							140000
		Social security taxes payable								52080
		Medicare taxes payable								12180
		Employee federal income taxes payable								210000
		Employee state income taxes payable								47000
		Employee medical insurance payable								6800
		Employee life insurance payable								5600
		Employee union dues payable								11000
		Salaries payable				(Balance figure)				495340
	Journal entry for cash payment of net payroll:
	Date	Particulars							Debit	Credit
	July	Salaries payable							495340
		Cash								495340
3	Tax				Amounts subject to tax	Tax rate	Tax amount
					1	2	1*2
	State unemployment taxes payable				70000	5.40%	3780
	Federal unemployment taxes payable				70000	0.60%	420
4	Journal entry for accrued employer payroll taxes:
	Date	Particulars							Debit	Credit
	July	Payroll tax expenses							87060
		Social security taxes payable								52080
		Medicare taxes payable								12180
		Employee medical insurance payable								ekkarill92 Next > < Previous Related Solutions The following monthly data are taken from Ramirez Company at July 31: Sales salaries, $640,000; Office... The following monthly data are taken from Ramirez Company at July 31: Sales salaries, $640,000; Office salaries, $128,000; Federal income taxes withheld, $192,000; State income taxes withheld, $43,000; Social security taxes withheld, $47,616; Medicare taxes withheld, $11,136; Medical insurance premiums, $15,400; Life insurance premiums, $12,300; Union dues deducted, $8,400; and Salaries subject to unemployment taxes, $69,000. The employee pays 40% of medical and life insurance premiums. Prepare journal entries to record (1) accrued payroll, including employee deductions for July; (2)... The following monthly data are taken from Ramirez Company at July 31: Sales salaries, $460,000; Office... 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