Question

The payroll register of Chen Engineering Co. indicates $2,256 of social security withheld and $564.00 of Medicare tax withheld on total salaries of $37,600 for the period. Earnings of $11,700 are subject to state and federal unemployment compensation taxes at the federal rate of 0.6% and the state rate of 5.4%. Provide the journal entry to record the payroll tax expense for the period. If an amount box does not require an entry, leave it blank. Round to two decimal places.

Answer 1

Account Titles and Explanation	Debit	Credit
Payroll tax Expense           [Total = $2,256 + $564 + $631.80 + $70.20]	$3,522.00
Social Security Tax payable		$2,256.00
Medicare Tax payable		$564.00
State Unemployment Tax Payable                    [$11,700 x 5.40%]		$631.80
Federal Unemployment Tax Payable               [$11,700 x 0.60%]		$70.20
(To record the payroll tax expense)