Question

What are the General Journal entries that should appear on each pay date? Employee pay accrual and employee pay disbursement Employee pay disbursement and voluntary deduction remittance Employee pay remittance and voluntary deduction remittance Employee pay recording and employer share payroll taxes recording

Answer 1

1. First of all we should pass following journal entry at the end of the pay period.

               

                                                Account Debit                                     Credit

Gross wages $50,000

FICAp ayable $1,000

Federal Income taPayable 500

State Income tax payable 100

Payroll Payable (Net Wages) 48,400

2. After that pass journal following entry at the time of paycheck to employee.

Wages Payable/ Payroll Payable                                                                                $48,400

Cash $48,400

3. Finally we require paying employer taxes and remitting withheld taxes.

FICA Tax withholdings Payable                                                                   $1,000

Federal Income tax payable 500

State Income tax payable 100

FICA tax (Employer Portion) payable 1,000

Federal Unemployment payable 100

State unemployment payble 10

Cash $2710

Here FICA means Federal Insurance Contributions Act which is a US federal payroll contribution directed towards both employees and employers to fund social security and Medicare.