Question

payroll Register and Payroll Journal Entry

1. Prepare a payroll register for Mary’s Luxury Travel for the week ended March 22, 20--. (In the Taxable Earnings/Unemployment Compensation column, enter the same amounts as in the Social Security column.) Total the amount columns. Round your answers to the nearest cent.

2. Assuming that the wages for the week ended March 22 were paid on March 24, prepare the journal entry for the payment of the payroll. When required, enter amounts in dollars and cents. If an amount box does not require an entry, leave it blank.

Mary Losch operates a travel agency called Mary’s Luxury Travel. She has five employees, all of whom are paid on a weekly basis. The travel agency uses a payroll register, individual employee earnings records, and a general journal.

Mary’s Luxury Travel uses a weekly federal income tax withholding table. Refer to Figure 8-4 in the text. The payroll data for each employee for the week ended March 22, 20—, are given below. Employees are paid 1½ times the regular rate for working over 40 hours a week.

Name	No. of Allowances	Marital Status	Total Hours Worked Mar. 16–22	Rate	Total Earnings Jan. 1–Mar. 15
Bacon, Andrea	4	M	44	$12	$5,600
Cole, Andrew	1	S	40	12	5,780
Hicks, Melvin	3	M	43	10.5	4,800
Leung, Cara	1	S	35	11	5,105.5
Melling, Melissa	2	M	40	10.5	4,704.5

   Social Security tax is withheld from the first $118,500 of earnings at the rate of 6.2%. Medicare tax is withheld at the rate of 1.45%, and city earnings tax at the rate of 1%, both applied to gross pay. Bacon and Leung have $16 withheld and Cole and Hicks have $5 withheld for health insurance. Bacon and Leung have $18 withheld to be invested in the travel agency’s credit union. Cole has $39.75 withheld and Hicks has $18.75 withheld under a savings bond purchase plan.

   Mary’s Luxury Travel’s payroll is met by drawing checks on its regular bank account. The checks were issued in sequence, beginning with Check No. 423.

1. Prepare a payroll register for Mary’s Luxury Travel for the week ended March 22, 20--. (In the Taxable Earnings/Unemployment Compensation column, enter the same amounts as in the Social Security column.) Total the amount columns. Round your answers to the nearest cent.

			Payroll Register for Period Ended											March 22		20--
			Earnings				Taxable Earnings		Deductions
Name	No. Allow.	Marit. Status	Regular	Overtime	Total	Cumulative Total	Unemploy. Comp.	Social Security	Federal Income Tax	Social Security Tax	Medicare Tax	City Tax	Health Insurance	Other		Total	Net Pay	Ck. No.
Bacon, Andrea	4	M												Credit Union
Cole, Andrew	1	S												Bonds
Hicks, Melvin	3	M												Bonds
Leung, Cara	1	S												Credit Union
Melling, Melissa	2	M
			. Assuming that the wages for the week ended March 22 were paid on March 24, prepare the journal entry for the payment of the payroll. When required, enter amounts in dollars and cents. If an amount box does not require an entry, leave it blank. Page: 1 DATE ACCOUNT TITLE DOC. NO. POST. REF. DEBIT CREDIT 1 Mar. 24 Wages and salaries expense 1 2 Employee federal income tax payable 2 3 Social security tax payable 3 4 Medicare tax payable 4 5 City tax payable 5 6 Health insurance premiums payable 6 7 Credit union payable 7 8 U.S. savings bonds payable 8 9 Cash 9 10 Payroll for week ended March 22 10

Answer 1

PAYROLL REGISTER - WEEK ENDED MAR 22, 20__
	Name	Employee No.	Allowances	Marital status	Earnings				Taxable Earnings		Deductions								Net pay	Check No.
					Regular	Overtime	Total	Cumulative Total	Unemployment Compensation	Social Security	Federal Income Tax	Social Security Tax	Medicare Tax	City Tax	Health Insurance	Other		Total
1	Bacon, Andrea	1	4	M	480	72	552	6152	552	552	8	34.22	8.00	5.52	16	Credit Union	18	89.75	462.25	423
2	Cole, Andrew	2	1	S	480		480	6260	480	480	46	29.76	6.96	4.80	5	Bonds	39.75	132.27	347.73	424
3	Hicks,Melvin	3	3	M	420	47.25	467.25	5267.25	467.25	467.25	7	28.97	6.78	4.67	5	Bonds	18.75	71.17	396.08	425
4	Leung, cara	4	1	S	385		385	5490.5	385	385	31	23.87	5.58	3.85	16	Credit Union	18	98.30	286.70	426
5	Melling, Melissa	5	2	M	420		420	5124.5	420	420	11	26.04	6.09	4.20				47.33	372.67	427
					2185	119.25	2304.25	28294.25	2304.25	2304.25	103	142.86	33.41	23.04	42	0	94.5	438.82	1,865.43
Note - I have available 2015 withholding rates, and that is used in federal income tax, please look the effect of this might change your answer.
	Date	Description						Debit	Credit
	Mar 24, 20__	Wages and Salaries Expense						$   2,304.25
		Employee Federal Income Tax Payable							$                103.00
		Social Security Tax Payable							$                142.86
		Medicare Tax Payable							$                  33.41
		City Earnings Tax Payable							$                  23.04
		Health Insurance Premiums Payable							$                  42.00
		Credit Union Payable							$                  36.00
		Savings Bond Deductions Payable							$                  58.50
		Cash							$            1,865.44
		Payroll for Week ended Mar. 22