Sandler Company completed the following two transactions. The annual accounting period ends December 31. On December 31, calculated the payroll, which indicates gross earnings for wages ($350,000), payroll deductions for income tax ($37,000), payroll deductions for FICA ($29,000), payroll deductions for United Way ($4,900), employer contributions for FICA (matching), and state and federal unemployment taxes ($2,900). Employees were paid in cash, but payments for the corresponding payroll deductions have not been made and employer taxes have not yet been recorded.Collected rent revenue of $1,770 on December 10 for office space that Sandler rented to another business. The rent collected was for 30 days from December 12 to January 10 and was credited in full to Deferred Revenue. Required:1. & 2. Prepare the entries required on December 31 to record payroll, the collection of rent on December 10 and adjusting journal entry on December 31.3. Show how any liabilities related to these items should be reported on the company’s balance sheet at December 31.

It is the first step to record financial transactions in the books of accounts that has dual effects…

Answered: Sandler Company completed the following…

College Accounting (Book Only): A Career Approach

13th Edition

ISBN:9781337280570

Author:Scott, Cathy J.

Publisher:Scott, Cathy J.

Chapter8: Employer Taxes, Payments, And Reports

Section: Chapter Questions

Problem 4E

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Sandler Company completed the following two transactions. The annual accounting period ends December 31.

On December 31, calculated the payroll, which indicates gross earnings for wages ($350,000), payroll deductions for income tax ($37,000), payroll deductions for FICA ($29,000), payroll deductions for United Way ($4,900), employer contributions for FICA (matching), and state and federal unemployment taxes ($2,900). Employees were paid in cash, but payments for the corresponding payroll deductions have not been made and employer taxes have not yet been recorded.
Collected rent revenue of $1,770 on December 10 for office space that Sandler rented to another business. The rent collected was for 30 days from December 12 to January 10 and was credited in full to Deferred Revenue.

Required:

1. & 2. Prepare the entries required on December 31 to record payroll, the collection of rent on December 10 and adjusting journal entry on December 31.
3. Show how any liabilities related to these items should be reported on the company’s balance sheet at December 31.

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