Question

During January, a company incurs employee salaries of $2.4 million. Withholdings in January are $183,600 for the employee portion of FICA, $360,000 for federal income tax, $150,000 for state income tax, and $24,000 for the employee portion of health insurance (payable to Company B). The company incurs an additional $148,800 for federal and state unemployment tax and $72,000 for the employer portion of health insurance.

Required:

1.-3. Record the necessary entries in the Journal Entry Worksheet below. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field. Enter your answers in dollars, not in millions (i.e. 5 should be entered as 5,000,000).)

Record the employee salary expense, withholdings, and salaries payable.

Record the employer-provided fringe benefits.

Record the employer payroll taxes.

Answer 1

Answer
Journal entry
Employee's salary expense, withholdings, and salaries payable
Date	Account Titles and Explanations	Debit	Credit
31-Jan	Salaries Expenses	$   24,00,000
	To, FICA Tax payable		$     1,83,600
	To, Federal income tax		$     3,60,000
	To, State income tax		$     1,50,000
	To, Payable to Company B		$        24,000
	To, Salary Payable (Amt due - salaries )		$   16,82,400
Employer-provided fringe benefits
31-Jan	Salaries Expenses	$        72,000
	To, Payable to Company B		$        72,000
Employer payroll taxes
31-Jan	Payroll tax expenses	$     3,32,400
	To, FICA Tax payable		$     1,83,600
	To, Federal and state unemployment tax		$     1,48,800
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