Question

In the following summary of data for a payroll period, some amounts have been intentionally omitted: Earnings: 1. At regular rate ? 2. At overtime rate $48,500 3. Total earnings ? Deductions: 4. Social security tax 19,440 5. Medicare tax 4,860 6. Income tax withheld 82,500 7. Medical insurance 11,200 8. Union dues ? 9. Total deductions 120,000 10. Net amount paid 204,000 Accounts debited: 11. Factory Wages 171,700 12. Sales Salaries ? 13. Office Salaries 64,800

a. Calculate the amounts omitted in lines (1), (3), (8), and (12). (1) $ 540,000 (3) $ 540,000 (8) $ (12) $

b. Journalize the entry to record the payroll accrual. If an amount box does not require an entry, leave it blank.

c. Journalize the entry to record the payment of the payroll.

Answer 1

a
1. At regular rate	275500
3. Total earnings	324000
8. Union dues	2000
12. Sales Salaries	87500
b
Factory wages expense	171700
Sales salaries expense	87500
Office salaries expense	64800
Social Security tax payable		19440
Medicare tax payable		4860
Employees Income tax payable		82500
Medical Insurance payable		11200
Union dues payable		2000
Salaries payable		204000
c
Salaries payable	204000
Cash		204000
Workings:
Net amount paid	204000
Add:Total deductions	120000
Total earnings	324000
Total earnings	324000
Less: At overtime rate	48500
At regular rate	275500
Total deductions	120000
Less:
Social security tax	19440
Medicare tax	4860
Income tax withheld	82500
Medical insurance	11200
	118000
Union dues	2000
Total earnings	324000
Less:
Factory Wages	171700
Office Salaries	64800
	236500
Sales Salaries	87500