Question

XYZ’s 3 employees earned a total of $2,000 of wages for the week. XYZ deducted $400 for federal income taxes, $200 for state income taxes $153 for Social Sec and Medicare. The company matches the Social Sec and Medicare tax and pays state unemployment tax of $80 and federal unemployment tax of $20. Calculate the payroll deductions, net pay, and employer taxes for the week and answer the following questions:

What would be the amount of Total Employee Deductions/Taxes Payable for the week?

		$   753.
		$   853.
		$1606.
		$1247

What would be the amount of Employer Payroll Taxes?

		$   753.
		$   853.
		$1606.
		$1247

What would be the amount of Net Pay?

		$   753.
		$   853.
		$1606.
		$1247

What is the entry when the payroll is paid?

		Debit Payroll Liabilities (Fed Income Tax Payable, State Income Tax Payable, Soc Sec&Medicare Payable), Credit Salaries & Wages Expense , Credit Cash
		Debit Cash, Credit Salaries & Wages Expense
		Debit Salaries & Wages Expense, Credit Payroll Liabilities(Fed Income Tax Payable,                 State Income Tax Payable, Soc Sec&Medicare Payable),,Credit Cash
		Debit Employer Payroll Taxes, Credit Employer Payroll Tax Liabilities

Answer 1

What would be the amount of Total Employee Deductions/Taxes Payable for the week? $753

Total Employee Deductions
federal income taxes	$           400
state income taxes	$           200
Social Sec and Medicare tax	$           153
Total Deductions	$           753

-

What would be the amount of Employer Payroll Taxes? $253

Employer Payroll Taxes
Social Sec and Medicare tax	$           153
state unemployment tax	$             80
federal unemployment tax	$             20
Total Payroll Tax Expenses	$           253

*** Since $253 is not available to choose in the question, but I am sure this is the correct answer.

(It will be a mistake happened in the question)

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What would be the amount of Net Pay? $1,247

Net Pay
Gross Salary	$       2,000
Less: Total Employee Deductions	$         -753
Net Pay	$       1,247

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What is the entry when the payroll is paid?

Debit Salaries & Wages Expense, Credit Payroll Liabilities(Fed Income Tax Payable,
                State Income Tax Payable, Soc Sec&Medicare Payable),,Credit Cash

The entry will be:

Account Title	Debit	Credit
Salaries & Wages Expense	$       2,000
Fed Income Tax Payable		$            400
State Income Tax Payable,		$            200
Soc Sec&Medicare Payable		$            153
Cash		$        1,247