Question

The payroll records of Airtech Solutions, Ltd. are provided for the period ended December 7:  

Required:

Compute the necessary information for the payroll journal entries.

Complete the entry to accrue the payroll.

Complete the entry to record the payroll tax expense.

PLEASE show all you work so it is easier to understand, thank you!                     

Employee	Earnings to End of Previous Week	Gross Pay	Federal Income Taxes	Medical Insurance Deduction	Union Dues	United Way	State Income Taxes
R. Arthur	$54,000	$1,200	$160	$125	$15	$30	42
J. Baines	6,500	900	102	125	15	25	32
T. Carter	8,500	750	85	125	15	15	26
J. Hess	116,800	2,500	450	150	-0-	50	90
L. Vang	145,000	2,900	580	150	-0-	50	105
Totals

The FICA Social Security compensation limit is $118,500.                The state unemployment tax rate is 5.4% on the first $9,000 paid to each employee.                 

Employee	FICA SS wage base for pay period	FUTA wage base for pay period	SUTA wage base for pay period	FICA Medz wage base for pay period
R. Arthur
J. Baines
T. Carter
J. Hess
L. Vang
Total wage base
Tax rate
Accrued taxes

(NOTE: Be sure to limit the amount of the wage base for the annual limitation)

Record the payroll for the period
Record the employer payroll taxes for the period

Answer 1

Employee	FICA SS wage base for pay period	FUTA wage base for pay period	SUTA wage base for pay period	FICA Medz wage base for pay period
					R.Arthur	1200.00	0.00	0.00	1200.00
J.Bains	900.00	0.00	0.00	900.00
T.Carter	750.00	500.00	500.00	750.00
J.Hess	1700.00	0.00	0.00	2500.00
L.Vang	0.00	0.00	0.00	2900.00
Total wage base	4550.00	500.00	500.00	8250.00
Tax Rate	6.20%	0.60%	5.40%	1.45%
Accrued Taxes	282.10	3.00	27.00	119.63

Working:

Employe earnings subject to tax for FICA SS
	Earnings to end of	Current	Gross pay	Earnings	Earnings
	previous week	week pay	upto Aug.25	Limit	Subject to tax
R.Arthur	54000	1200	55200	118500	1200
J.Bains	6500	900	7400	118500	900
T.Carter	8500	750	9250	118500	750
J.Hess	116800	2500	119300	118500	1700
L.Vang	145000	2900	147900	118500	0

Employee earnings subject to tax for FUTA / SUTA
	Earnings to end of	Current	Gross pay	Earnings	Earnings
	previous week	week pay	upto Aug.25	Limit	Subject to tax
R.Arthur	54000	1200	55200	9000	0
J.Bains	6500	900	7400	9000	0
T.Carter	8500	750	9250	9000	500
J.Hess	116800	2500	119300	9000	0
L.Vang	145000	2900	147900	9000	0

1. Each employee's net (Take home) pay
Employee	Total Gross pay	Withholdings							Total Withholding	Net Pay
		Federal income tax	State income tax	FICA		Medical	Union	United
				Social cecurity	Medicare	Insurance	Dues	Way
R.Arthur	1200.00	160.00	42.00	74.40	17.40	125.00	15.00	30.00	463.80	736.20
J.Bains	900.00	102.00	32.00	55.80	13.05	125.00	15.00	25.00	367.85	532.15
T.Carter	750.00	85.00	26.00	46.50	10.88	125.00	15.00	15.00	323.38	426.63
J.Hess	2500.00	450.00	90.00	105.40	36.25	150.00	0.00	50.00	881.65	1618.35
L.Vang	2900.00	580.00	105.00	0.00	42.05	150.00	0.00	50.00	927.05	1972.95
Total	8250.00	1377.00	295.00	282.10	119.63	675.00	45.00	170.00	2963.73	5286.28

Working:

1.Employee FICA withholding for Social Secutiry
Employee	Employee earnings	Tax rate	Tax
	subject to tax
Dali	1200.00	6.20%	74.40
Trey	900.00	6.20%	55.80
Kiesha	750.00	6.20%	46.50
Chee	1700.00	6.20%	105.40
L.Vang	0	6.20%	0.00
Total	4550.00		282.10

2.Employee FICA withholding for Medicare
Employee	Employee earnings	Tax rate	Tax
	subject to tax
R.Arthur	1200.00	1.45%	17.40
J.Bains	900.00	1.45%	13.05
T.Carter	750.00	1.45%	10.88
J.Hess	2500.00	1.45%	36.25
L.Vang	2900.00	1.45%	42.05
Total	8250.00		119.63

1. Entry to record payroll
Account Title	Debit	credit
Salaries and wages expense	8250.00
Employee Federal Income tax payable		1377.00
Employee State Income tax payable		295.00
Employee FICA SS payable		282.10
Employee FICA Medz payable		119.63
Employee medical insurance payable		675.00
Union dues payable		45.00
United Way payable		170.00
Salaries and wages payable		5286.27
2. Entry to record payroll tax expenses
Account Title	Debit	credit
Payroll tax expense	431.73
Employee FICA SS payable		282.10
Employee FICA Medz payable		119.63
FUTA payable		3.00
SUTA payable		27.00