Question

Continuing Payroll Problem, 6B: Chapter 6

You have almost completed the Olney Company's Employee Payroll Register for the pay period ending January 8, 20--.

In this last task, the following steps will be completed.

Requirements:

Record the deduction for group insurance.

Record the health insurance deduction.

Record the check number assigned to each employee.

Compute and record the net pay for each employee.

Total the input columns on the Employee Payroll register.

On Employer Register, enter the total gross earnings.

Prepare the journal entries as of January 12 to record the payroll and the payroll taxes for the week ending January 8. Credit Salaries Payable for the total net pay.

Prepare the journal entry to record the payment of the payroll on January 14 when the paychecks are distributed to all workers.

Employee Benefits

The table below lists the employee contributions to Group Insurance and Health Insurance. Also, a check number has been assigned to each employee. Note that some employees are not yet eligible for Group Insurance coverage under the company plan.

OLNEY COMPANY, INC. Insurance Deduction Register
Name	GRP. INS.	HEALTH INS.	CK. NO.
Mangino, R.	$0.85	$1.65	313
Flores, I.	0.85	1.65	314
Palmetto, C.		1.65	315
Waters, R.	0.85	1.65	316
Kroll, C.	0.85	1.65	317
Ruppert, C.	0.85	1.65	318
Scott, W.	0.85	1.65	319
Wickman, S.		1.65	320
Foley, L.	0.85	1.65	321
Olney, M.	0.85	1.65	322

Completing the Payroll Register

The Employee Payroll Register presents all the computations previously performed as it applies to this payroll period.

Complete the following steps:

Record the amount to be withheld for group insurance.

Record the amount to be withheld for health insurance.

Each worker is to be paid by check. Assign check numbers provided to the correct employee.

Compute the net pay for each employee.

Total the input columns.

OLNEY COMPANY, INC. Payroll Register For Period Ending January 8, 20--
	EARNINGS	DEDUCTIONS									NET PAY
Name	Gross	OASDI	HI	FIT	SIT	SUTA	CIT	SIMPLE	Grp. Ins.	Health Ins.	Ck. No.	Amount
Mangino, R.	$740.00	$45.88	$10.73	$81.00	$22.72	$0.52	$14.62	$20.00	$	$		$
Flores, I.	1,058.80	65.65	15.35	158.00	32.51	0.74	20.91	50.00
Palmetto, C.	685.30	42.49	9.94	32.00	21.04	0.48	13.53	40.00
Waters, R.	1,045.35	64.81	15.16	70.00	32.09	0.73	20.65	60.00
Kroll, C.	952.00	59.02	13.80	102.00	29.23	0.67	18.80	20.00
Ruppert, C.	837.50	51.93	12.14	41.00	25.71	0.59	16.54	40.00
Scott, W.	780.00	48.36	11.31	26.00	23.95	0.55	15.41	50.00
Wickman, S.	807.69	50.08	11.71	86.00	24.80	0.57	15.95	50.00
Foley, L.	1,233.16	76.46	17.88	79.00	37.86	0.86	24.35	30.00
Olney, M.	1,500.00	93.00	21.75	89.00	46.05	1.05	29.63	80.00
Totals		$597.68	$139.77	$764.00	$295.96	$6.76	$190.39	$440.00			----

Employer Register

Complete the following:

Record the total gross earnings.

OLNEY COMPANY, INC. Employer Register Payroll Taxes
	Taxable Earnings	OASDI	HI	FUTA	SUTA
Totals	$	$597.67	$139.78	$57.84	$354.60

Journal Entry: Recording Payroll

Complete the following:

Prepare the journal entries as of January 12 to record the payroll and the payroll taxes for the week ending January 8. Credit Salaries Payable for the total net pay.

Date	Account	Debit	Credit
20-- Jan. 12
	To record payroll.
20-- Jan. 12
	To record payroll taxes.

Journal Entry: Payroll Distribution

Complete the following:

Prepare the journal entry to record the payment of the payroll on January 14 when the paychecks are distributed to all workers.

Date	Account	Debit	Credit
20-- Jan. 14

Answer 1

The solutions to the given problem is below.

1	Completed Payroll
	OLNEY COMPANY, INC.
	Payroll Register
	For Period Ending January 8, 2012
		EARNINGS	DEDUCTIONS									NET PAY
	Name	Gross	OASDI	HI	FIT	SIT	SUTA	CIT	SIMPLE	Grp. Ins.	Health Ins.	Ck. No.	Amount
	Mangino, R.	$740.00	$45.88	$10.73	$81.00	$22.72	$0.52	$14.62	$20.00	0.85	1.65	313	$542.03
	Flores, I.	1,058.80	65.65	15.35	158	32.51	0.74	20.91	50	0.85	1.65	314	$713.14
	Palmetto, C.	685.3	42.49	9.94	32	21.04	0.48	13.53	40		1.65	315	$524.17
	Waters, R.	1,045.35	64.81	15.16	70	32.09	0.73	20.65	60	0.85	1.65	316	$779.41
	Kroll, C.	952	59.02	13.8	102	29.23	0.67	18.8	20	0.85	1.65	317	$705.98
	Ruppert, C.	837.5	51.93	12.14	41	25.71	0.59	16.54	40	0.85	1.65	318	$647.09
	Scott, W.	780	48.36	11.31	26	23.95	0.55	15.41	50	0.85	1.65	319	$601.92
	Wickman, S.	807.69	50.08	11.71	86	24.8	0.57	15.95	50		1.65	320	$566.93
	Foley, L.	1,233.16	76.46	17.88	79	37.86	0.86	24.35	30	0.85	1.65	321	$964.25
	Olney, M.	1,500.00	93	21.75	89	46.05	1.05	29.63	80	0.85	1.65	322	$1,137.02
	Totals	$9,639.80	$597.68	$139.77	$764.00	$295.96	$6.76	$190.39	$440.00	$6.80	$16.50		$7,181.94
2	Journal Entry to record the Salary payable
Date	Account	Debit	Credit
20-Jan-12	Payroll Cost	9639.8
	OASDI Payable		597.68
	HI Payable		139.77
	FIT Payable		764
	SIT Payable		295.96
	SUTA Payable		6.76
	CIT Payable		190.39
	SIMPLE Payable		440
	Grp. Ins. Payable		6.8
	Health Ins. Payable		16.5
	Salary Payable		7181.94
	( To record Payroll cost and Net Salary payable)
3	Total Gross Earnings	9639.8
4	Journal Entry to record Payroll Taxes
Date	Account	Debit	Credit
20-Jan-12	OASDI Expenses	597.67
	HI Expenses	139.78
	FUTA Expenses	57.84
	SUTA Expenses	354.6
	OASDI Payable		597.67
	HI Payable		139.78
	FUTA Payable		57.84
	SUTA Payable		354.6
	( To record the pay roll taxes)
5	Journal Entry for recording payment of payroll
Date	Account	Debit	Credit
20-Jan-12	Salary Payable	542.03
	Bank		542.03
	To record payment of Salary payable vide Cheque No.313
20-Jan-12	Salary Payable	713.14
	Bank		713.14
	To record payment of Salary payable vide Cheque No.314
20-Jan-12	Salary Payable	524.17
	Bank		524.17
	To record payment of Salary payable vide Cheque No.315
20-Jan-12	Salary Payable	779.41
	Bank		779.41
	To record payment of Salary payable vide Cheque No.316
20-Jan-12	Salary Payable	705.98
	Bank		705.98
	To record payment of Salary payable vide Cheque No.317
20-Jan-12	Salary Payable	647.09
	Bank		647.09
	To record payment of Salary payable vide Cheque No.318
20-Jan-12	Salary Payable	601.92
	Bank		601.92
	To record payment of Salary payable vide Cheque No.319
20-Jan-12	Salary Payable	566.93
	Bank		566.93
	To record payment of Salary payable vide Cheque No.320
20-Jan-12	Salary Payable	964.25
	Bank		964.25
	To record payment of Salary payable vide Cheque No.321
20-Jan-12	Salary Payable	1137.02
	Bank		1137.02
	To record payment of Salary payable vide Cheque No.322