CHAPTER 7: EMPLOYEE EARNINGS AND DEDUCTIONS LO 1,2,3, 4,5 PROBLEM 7-2A Highridge Homes has the following payroll information for the week ended February 21: Earnings at End of Daily Time Federal Previous Pay Income Name Week S M W Rate Тах Arthur, P. 7,800.00 8. 8 8. 8. 8 45.00 226.78 Bills, D. 2,060.00 8. 8. 8. 8. 8 12.50 26.00 Carney, W. 2,085.00 8 8 8. 8. 8 12.95 27.00 Dorn, J. 748.00 8 8 22.00 11.00 Edgar, L. 2,687.00 8. 8. 8. 8 8 15.00 37.00 Fitzwilson, G. 4,150.00 8 8 8. 8. 23.00 125.00 Taxable earnings for Social Security are based on the first $118,500. Taxable earnings for Medicare are based on all earnings. Taxable earnings for federal and state unemployment are based on the first $7,000. Employees are paid time-and-a-half for work in excess of 40 hours per week. Round amounts to the nearest penny. Check Figure Net amount, $4, Required 1. Complete the payroll register. The Social Security tax rate is 6.2 percent, and the Medicare tax rate is 1.45 percent. Begin payroll checks with No. 2080. 2. Prepare a general journal entry to record the payroll. The firm's general ledger contains a Wages Expense account and a Wages Payable account. 3. Assuming that the firm has transferred funds from its regular bank account to its special payroll bank account and that this entry has been made, prepare a general journal entry to record the payment of wages.

Corporate Financial Accounting

14th Edition

ISBN:9781305653535

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

Chapter10: Liabilities: Current, Installment Notes, And Contingencies

Section: Chapter Questions

Problem 10.12EX: Payroll entries The payroll register for D. Salah Company for the week ended May 18 indicated the...

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Payroll accounts and year-end entries The following accounts, with the balances indicated, appear in the ledger of Garcon Co. on December 1 of the current year: 211 Salaries Payable 212 Social Security Tax Payable 9,273 213 Medicare Tax Payable 2,318 214 Employees Federal Income Tax Payable 15,455 215 Employees State Income Tax Payable 13,909 216 State Unemployment Tax Payable 1,400 217 Federal Unemployment Tax Payable SOO 218 Retirement Savings Deductions Payable 3,400 219 Medical Insurance Payable 27r000 411 Operations Salaries Expense 950.000 S11 Officers Salaries Expense 600,000 SI 2 Office Salaries Expense 150.000 S19 Payroll Tax Expense 137,951 The following transactions relating to payroll, payroll deductions, and payroll taxes occurred during December: Dec. 2. Issued Check No. 410 for 53,400 to Jay Bank to invest in a retirement savings account for employees. 2. Issued Check No. 411 to Jay Bank for 527,046, in payment of 59,273 of social security tax, 2,318 of Medicare tax, and 15,455 of employees federal income tax due. 13 Journalized the entry to record the biweekly payroll. A summary of the payroll record follows: Dec. 13. Issued Check No. 420 in payment of the net amount of the biweekly payroll to fund the payroll bank account. 13. Journalized the entry to record payroll taxes on employees' earnings of December 13: social security tax. 4,632; Medicare tax, 1,158; state unemployment tax. 350; federal unemployment tax, 125. 16. Issued Check No. 424 to Jay Bank for 27,020. in payment of 9,264 of social security tax, 2,316 of Medicare tax, and 15,440 of employees' federal income tax due. 19. Issued Check No. 429 to Sims-Walker Insurance Company for 31,500, in payment of the semiannual premium on the group medical insurance policy. 27. Journalized the entry to record the biweekly payroll. A summary of the payroll 27. Issued Check No. 541 in payment of the net amount of the biweekly payroll to fund the payroll bank account. 27. Journalized the entry to record payroll taxes on employees' earnings of December 27: social security tax, 4,668; Medicare tax. 1,167: state unemployment tax, 225; federal unemployment tax, 75. 27. Issued Check No. 543 for 20,884 to State Department of Revenue in payment of employees' state income tax due on December 31. 31. Issued Check No. 545 to Jay Bank for 3400 to invest in a retirement savings account for employees. 31. Paid 45,000 to the employee pension plan. The annual pension cost is 60,000. (Record both the payment and unfunded pension liability.) Instructions 1. Journalize the transactions. 2. Journalize the following adjusting entries on December 31: a. Salaries accrued: operations salaries, 8,560; officers salaries, 5,600: office salaries, 1,400. The payroll taxes are immaterial and are not accrued. b. Vacation pay, 15,000.
Payroll accounts and year-end entries The following accounts, with the balances indicated, appear in the ledger of Codigo Co. on December 1 of the current year: 101 Salaries Payable 102 Social Security Tax Payable 52,913 103 Medicare Tax Payable 728 104 Employees Federa1 Income Tax Payable 4,490 1 OS Employees State Income Tax Payable 4,073 T C-5 State Unemployment Tax Payable 1,260 107 Federal Unemployment Tax Payable 360 108 Retirement Savings Deductions Payable 2,300 109 Medical Insurance Payable 2,520 201 Sales Salaries Expense 700,000 301 Officers Salaries Expense 340,00O 401 Office Salaries Expense 125,000 408 Payroll Tax Expense 59,491 The following transactions relating to payroll, payroll deductions, and payroll taxes occurred during December: Dec. 1. Issued Check No. 815 to Aberderas Insurance Company for 2,520, in payment of the semiannual premium on the group medical insurance policy. 1, Issued Check No. 816 to Alvarez. Bank for 8,131, in payment for 2,913 of social security tax, 728 of Medicare tax, and 4,490 of employees federal income tax due. 2. Issued Check No. 817 for 2,300 to Alvarez Bank to invest in a retirement savings account for employees. 12 Journalized the entry to record the biweekly payroll. A summary of the payroll record follows: 12. Issued Check No. 822 in payment of the net amount of the biweekly payroll to fund tile payroll bank account. 12. Journalized the entry to record payroll taxes on employees' earnings of December 12: social security tax, SI,452; Medicare tax, 363: state unemployment tax, 315: federal unemployment tax. 90. 15. Issued Check No. 830 to Alvarez Bank for 7,938, in payment of 2,904 of social security tax, 726 of Medicare tax, and 4,308 of employees' federal income tax due. 26. Journalized the entry to record the biweekly payroll. A summary of the payroll record follows: Dec. 26. Journalized the entry to record payroll taxes on employees' earnings of December 26: social security tax, SI,455; Medicare tax, 364; state unemployment tax, SI50; federal unemployment tax, S40. 30. Issued Check No. 851 for 6,258 to State Department of Revenue, in payment of employees' state income tax due on December 31. 30. Issued Check No. 852 to Alvarez Bank for 2,300 to invest in a retirement savings account for employees. 31 Paid 55,400 to the employee pension plan. The annual pension cost is 65,500. (Record both the payment and the unfunded pension liability.) Instructions 1. Journalize the transactions. 2. Journalize the following adjusting entries on December 31: a. Salaries accrued: sales salaries, 4,275; officers salaries, 2,175; office salaries, 825. The payroll taxes are immaterial and are not accrued. b. Vacation pay, 13,350.
Payroll register The following data for Throwback Industries Inc. relate to the payroll for the week ended December 9, 2016: Employee Hours Worked Hourly Rate Weekly Salary Federal Income Tax U.S. Savings Bonds Aaron 46 68.00 750.20 100 Cobb 41 62.00 537.68 110 Clemente 48 70.00 832.64 120 DiMaggio 35 56.00 366.04 0 Griffey, Jr. 45 62.00 641.84 130 Mantle 1,800 342.45 120 Robinson 36 54.00 382.56 130 Williams 2,000 398.24 125 Vaughn 42 62.00 584.72 50 Employees Mantle and Williams are office staff, and all of the other employees are sales personnel. All sales personnel are paid 1 times the regular rate for all hours in excess of 40 hours per week. The social security tax rate is 6.0%, and Medicare tax is 1.5% of each employees annual earnings. The next payroll check to be used is No. 901. Instructions 1. Prepare a payroll register for Throwback Industries Inc. for the week ended December 9, 2016. Use the following columns for the payroll register: Employee, Total Hours, Regular Earnings, Overtime Earnings, Total Earnings, Social Security Tax, Medicare Tax, Federal Income Tax, U.S. Savings Bonds, Total Deductions, Net Pay, Ck. No., Sales Salaries Expense, and Office Salaries Expense. 2. Journalize the entry to record the payroll for the week]

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